TEMPORARY power provider APR Energy lost momentum yesterday after a results warning caused its share price to plunge as much as 37 per cent.
The FTSE 250-listed firm, which rents out turbines and generators, usually in developing countries, said that it “expects its full-year 2015 results to be significantly below market expectations”.
Shares slumped to 219p from Monday’s close of 348.5p, before recovering slightly to close 26.1 per cent lower at 259.25p.
The Florida-based company attributed the lower earnings forecast to higher than expected costs from exiting Libya, delays to finalising contracts and currency headwinds in Australia and Indonesia.
It also warned that it may have trouble meeting its financial covenants from the next quarter onwards.
“Challenging market conditions continue to delay new contract announcements...We believe the shares will continue to trade at a significant discount until greater confidence emerges,” said Numis research.
APR had already warned that its 2015 loss could be larger than expectations, after reporting a pre-tax loss of $723.6m (£462.9m) in April, due to problems tying up its business in Libya after the government failed to validate its contract.
Liberum analysts raised their 2015 pre-tax loss forecast for APR to $87m, from $37m.
There is a demand for temporary energy in developing countries where infrastructure networks are not always sufficient, for large construction projects for example. But it also leaves APR exposed to political volatility in the countries it operates in.
In a separate announcement yesterday, APR said that its chief operations officer Brian Rich has decided to step down from his role for personal reasons, with immediate effect.