Aggreko Plc (AGK), the world’s largest supplier of portable electricity generators, reported first-half sales that beat analyst estimates as the British company won orders in South America and Southern Africa.
Revenue increased 1 percent to 768 million pounds ($1.3 billion) in the first six months, the Glasgow-based company said in a statement today. That beat the average estimate of 742 million pounds by analysts in a Bloomberg survey. The stock gained as much as 4.8 percent in London trading.
The company is benefiting as demand for its mobile electricity generators, which are rented to clients on a temporary basis, is rising in emerging markets. In the first half, order intake rose to 488 megawatts of power on rent, from 397 megawatts in the same period last year as the company secured new contracts in Panama, Mozambique, Namibia and South Africa, Angus Cockburn, the company’s interim chief executive officer, said by phone.
“The economies in the world are just beginning to go through a recovery stage,” Cockburn said, “We’re more encouraged than we were but we’re not going to get carried away. It’s still early and customers are still cautious.”
Profit before tax fell 9 percent to 132 million pounds in the first half.
Aggreko rose as much as 83 pence to 1,804 pence per share and was up 2.1 percent as of 10:56 a.m., valuing the company at 4.5 billion pounds. Before today, the stock had lost 4.2 percent since the start of the year, while the British FTSE 100 (UKX) benchmark index dropped 1.1 percent.
The impact of currency swings cut revenue by 80 million pounds and trading profit by 23 million pounds in the first half as the pound strengthened against the company’s major operating currencies. Exchange rates will decrease full-year revenue by 150 million pounds and cut trading profit by 50 million pounds, though the long-term impact won’t be “huge”, Cockburn said.
“I’ve been around Aggreko for almost 15 years and from what I’ve seen with currencies, it’s like a roller coaster,” he said. “One minute you’re flying upwards and the next minute you’re flying downwards and you’ve just got to take a deep breath, hold on to your stomach and it all equals out in time.”
The company said today that Ken Hanna would assume the role of executive chairman after Cockburn steps down on Sept. 30. Hanna will hold the position until incoming CEO Chris Weston is released from his contract at British energy company Centrica (CNA) at an as yet undetermined date, Cockburn said.
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