Aggreko (AGK)

Sector:

Support

Index:

FTSE 250

856.60p
   
  • Change Today:
      10.00p
  • 52 Week High: 869.20p
  • 52 Week Low: 693.20p
  • Currency: UK Pounds
  • Volume: 268,868
  • RiskGrade: 90

Aggreko loses power on Argentina, order intake concerns

By Michele Maatouk

Date: Tuesday 21 Nov 2017

LONDON (ShareCast) - (ShareCast News) - Aggreko shares tanked on Tuesday as investors focused on disappointing order intake and weakness in Argentina in the temporary power provider's third-quarter results.
In an update for the period from 1 July to 20 November, the company said revenue rose just 1% on last year, with reported revenue up 8%. Excluding the impact of Argentina, revenue was up 3% on an underlying basis.

Rental Solutions revenue increased 9%, with revenue in North America up 10%, or 3% excluding the impact of the hurricanes, which generated incremental work but also resulted in the cancellation of maintenance work.

In the Power Solutions Industrial division, revenue was 6% higher, with a strong performance in Eurasia and a good performance in Africa. However, the Middle East saw lower volumes in Qatar after the imposition of sanctions, and in Saudi Arabia, where the lower oil price continues to impact the economy.

In Power Solutions Utility, revenue fell 15%, driven by re-pricing and off-hires in Argentina. Excluding the impact of Argentina, revenues were down 7%. Meanwhile, the year-to-date order intake is 666 MW, down from 1,034 MW last year.

Aggreko said the prospect pipeline continues to be healthy, although it is taking longer to convert than last year. In Japan, half of its 148 MW contract has off-hired early, paying an early termination fee, and it expects the rest to off-hire in the first quarter of 2018. In addition, it continues to expect that the remaining 214 MW of volume in Argentina will off-hire at the end of 2017.

The off-hire rate for the nine months ending 30 September was 24% and Aggreko expects the full year rate to be in line with its historic average of around 30%, while forecast fleet capital expenditure is unchanged at around £300m.

"Our full year guidance remains unchanged. The trading performance continues to support our view that, Argentina aside, we will grow this year," Aggreko said.

RBC Capital Markets said it would expect 2018 consensus forecasts to come down 5-10% given a weak order intake and further off-hires.

Meanwhile, UBS said that while revenue growth of 1% is a small improvement compared to a flat performance in the first half of last year, it is slightly below the bank's forecast of 3% growth.

"While FY18 guidance will only be given in Mar-18, Aggreko is flagging some more headwinds today with Japan off-hiring early and Argentina's longer running to end this year. FY18e consensus PBT of circa £225m currently implies more than 12% growth overall, but these factors make this challenging and we expect to see consensus downgrades."

At 0915 GMT, the shares were down 9.3% to 879.50p.

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Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

Note 2: RiskGrade figures are provided by RiskMetrics.

 

Aggreko Market Data

Currency UK Pounds
Share Price 856.60p
Change Today 10.00p
% Change 1.18 %
52 Week High 869.20p
52 Week Low 693.20p
Volume 268,868
RiskGrade 90

Aggreko Star Ratings

Compare performance with the sector and the market.
more star ratings
Key: vs Market vs Sector
Value
0.47% above the market average0.47% above the market average0.47% above the market average0.47% above the market average0.47% above the market average
7.69% below the sector average7.69% below the sector average7.69% below the sector average7.69% below the sector average7.69% below the sector average
Price Trend
36.69% above the market average36.69% above the market average36.69% above the market average36.69% above the market average36.69% above the market average
1.61% above the sector average1.61% above the sector average1.61% above the sector average1.61% above the sector average1.61% above the sector average
Income
11.69% above the market average11.69% above the market average11.69% above the market average11.69% above the market average11.69% above the market average
2.38% above the sector average2.38% above the sector average2.38% above the sector average2.38% above the sector average2.38% above the sector average
Growth
66.69% below the market average66.69% below the market average66.69% below the market average66.69% below the market average66.69% below the market average
79.13% below the sector average79.13% below the sector average79.13% below the sector average79.13% below the sector average79.13% below the sector average

What The Brokers Say

Strong Buy 3
Buy 1
Neutral 1
Sell 1
Strong Sell 4
Total 10
neutral
Broker recommendations should not be taken as investment advice, and are provided by the authorised brokers listed on this page.

Aggreko Dividends

  Latest Previous
  Interim Final
Ex-Div 05-Sep-19 18-Apr-19
Paid 01-Oct-19 24-May-19
Amount 9.38p 17.74p

Trades for 17-Jan-2020

Time Volume / Share Price
16:50 2 @ 857.20p
16:50 1 @ 857.20p
16:35 13,972 @ 856.60p
16:35 147,502 @ 856.60p
16:28 50 @ 857.60p

Aggreko Key Personnel

CEO Chris Weston
CFO Heath Drewett

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