Aggreko PLC THIRD QUARTER TRADING UPDATE (9367E)
November 09 2015 - 2:00AM
UK Regulatory
TIDMAGK
RNS Number : 9367E
Aggreko PLC
09 November 2015
9 November 2015
THIRD QUARTER TRADING UPDATE
EXPECTATIONS FOR THE YEAR UNCHANGED
The trading update covers the period from 1 July 2015 to 8
November 2015. Unless otherwise stated, figures quoted in this
statement are for the quarter ended 30 September 2015.
Chris Weston, Chief Executive, commented: "Aggreko continues to
demonstrate its resilience against a challenging market backdrop
and I am pleased that we are maintaining our guidance for 2015 full
year profit before tax of between GBP250 and GBP270 million. Whilst
we are at an early stage in delivering the specific actions
identified at our business review in August, I am encouraged with
the progress we are making which, regardless of the prevailing
market conditions, will strengthen Aggreko and position it well for
the future."
Trading
Underlying(1) revenue for the third quarter was 7% behind last
year with reported revenue down 6%. All growth rates set out below
are on an underlying basis.
Business Unit Trading
Rental Solutions revenue was down 1% on last year. The on-going
weakness in the oil and gas and mining sectors, has been largely
offset by continued growth in other sectors, such as petrochemical
and refining. We also saw a strong temperature control season in
North America and Continental Europe.
Power Solutions revenue was 11% lower than the same period last
year. Within this, Industrial was 12% higher, including the
successfully executed European Games. We also saw solid growth in
our Russian and African businesses. However, the continuing weak
economic backdrop in Brazil is having an impact on our
business.
Utility revenue in Power Solutions was 21% lower than last year,
driven by the previously announced price reduction on our contract
extension in Bangladesh and the off-hiring of our contract in
Panama; excluding the impact of these, revenue was down 12%. Order
intake year to date is 561MW (2014: 697MW); last year's comparative
included 170MW of summer peak shaving work in Saudi Arabia and
Oman. In addition, we have extended our 260MW of gas contracts in
Mozambique until the end of the year. The closing order book at the
end of the third quarter is strong with the equivalent of 14 months
of forward revenue cover, reflecting the number of contract
extensions secured this year.
Management Change
We are delighted to have recently announced the appointment of
Nicolas Fournier as Managing Director, Power Solutions. Nicolas
joined Aggreko on 2 November 2015 and brings over 25 years of
international experience. Nicolas' appointment allows Chris Weston
to return to his main role as Chief Executive and further focus on
delivering the business priorities.
___________
(1) "Underlying" is defined as: adjusted for currency movements
and pass-through fuel revenue from Power Solutions, where we
provide fuel to our contracts in Mozambique on a pass-through
basis.
Business Priorities
At this early stage we are on track with the implementation of
the business priorities we outlined in August this year. The
Programme Management Office is in place with each of the
initiatives now sponsored and embedded in the business. In line
with our priorities, we announced a bolt-on acquisition on 2
September 2015 of ICS Group, a leading provider of specialist
heating solutions in Canada.
Capital Expenditure
In recognition of the trading environment and as we seek to
balance growth with maintaining a strong balance sheet, we have
further flexed our capex plans for the current year and now
anticipate spending around GBP250 million on fleet (2014: GBP226
million).
At this stage, we anticipate first half 2016 fleet capex to be
in the region of GBP120 million (2015: GBP138 million) and
consistent with past practice we will give full year capex guidance
for 2016 at the time of our full year results in March 2016.
Outlook
At a Group level, we continue to expect that the underlying
revenue trend in the second half of the year will be similar to
that in the first half, reflecting the on-going challenging market
conditions.
Overall, our guidance for profit before tax for the full year to
be between GBP250 million and GBP270 million at average exchange
rates remains unchanged.
Conference Call
A conference call will be held today for investors and analysts
at 9.00am (GMT), hosted by Chris Weston, CEO and Carole Cran,
CFO.
Dial in: + 44 20 3059 8125
Conference call name: Aggreko Third Quarter Trading Update
A recording of the call will be available on demand for 7
days.
Audio playback: + 44 121 260 4861
Reference: 2144095#
Future Reporting
Aggreko will report its 2015 Full Year Results on Thursday 3
March 2016.
Enquiries
Investors & Analysts
Louise Bryant, Aggreko plc +44 7876 478 272
Media
John Sunnucks / Lorna Cobbett, Bell
Pottinger +44 20 3772 2500
This information is provided by RNS
The company news service from the London Stock Exchange
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