SCOTTISH temporary power company Aggreko is forecasting it will make pre-tax profits of around £324 million in 2011, an increase of 5% on a 2010 figure which included earnings from several major one-off sporting events including football's World Cup.
This latest projected pre-tax profit, which excludes amortisation of goodwill, is ahead of guidance issued in October of "at least £320m" and a forecast back in August of "around £315m".
Aggreko made pre-tax profits of £307.1m on this basis in 2010, when it benefited from contracts to power the FIFA World Cup in South Africa, the Vancouver Winter Olympics and the Asian Games.
Aggreko predicted yesterday its "underlying trading profits", stripping out the impact of revenues from one-off events in both 2010 and 2011, would be up 25% this year. Aggreko, which said a "small amount of revenue" had arisen this year on its contract to power the 2012 London Olympics, is forecasting a 13% rise in its overall revenues this year to £1.4 billion.
Shares in Glasgow-based Aggreko, which has upgraded its earnings forecasts consistently this year in spite of the difficult and deteriorating global economic backdrop, rose 31p, or 1.7%, to 1848p yesterday. This raised the stock market worth of Aggreko, a member of the UK's FTSE-100 index of leading shares, by £83m to £4.93bn.
Rupert Soames, chief executive and grandson of wartime leader Sir Winston Churchill, was upbeat about current trading but voiced some caution about the potential impact of the global economic situation in the second half of next year.
Aggreko said yesterday: "Overall, we expect to deliver further growth in 2012, but much will depend on the economic environment."
Mr Soames, who has presided over rapid growth at Aggreko and a surge in the company's share price, told The Herald: "The business is doing pretty well. We have had a good 2011. We are going to start 2012 with pretty good momentum. That is all positive."
Touching on the economic backdrop, he added: "I think there are probably not many (companies) that are able to talk positively about either 2011 or 2012, but we are more cautious about the second half of 2012."
Aggreko was called in to provide temporary power to Japan, in the wake of the earthquake and tsunami in March.
Mr Soames said yesterday that this contract was likely to come to an end next summer.
He added: "It is a very large contract. We are, I hope, giving them a very good service. That contract is likely to come off some time next year, probably the end of the first half or the beginning of the second half. They will get themselves organised."
Mr Soames highlighted a near-doubling of Aggreko's workforce at Dumbarton, where the kit which is used worldwide is designed and assembled, to almost 400 people.
He noted Aggreko was in the process of moving into a new factory at Dumbarton, and underlined plans by Aggreko, announced yesterday, to invest around £320m in its fleet in 2012, following fleet capital expenditure of about £395m this year.
''
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article