Aggreko sinks as it warns of 2013 slowdown

TEMPORARY power solutions provider Aggreko saw its stock plummet yesterday, as it warned of slowing revenue next year.

Over the year to December, group revenues are expected to come in at around £1.6bn, up 13 per cent, the FTSE 100 firm said in a pre-close trading update. Profit before tax and amortisation is expected to increase 12 per cent to £365m.

Despite a strong 2012, the company, which supplies temporary power generators, warned that the economic environment next year is “particularly uncertain”.

The absence of the Olympics effect, a reduction in US troops in Afghanistan and the likelihood that Japanese clients will not extend their contracts into the second half of 2013 could push revenues down by around £100m next year, Aggreko said yesterday.

The power solutions company added that while its international power projects and local businesses were expected to grow in 2013, it would not be enough to mitigate the £100m reduction in revenue, leading to a lower group performance overall next year.

Yesterday’s statement marked the firm’s second profit warning in almost as many months.

In October, Aggreko warned that its full-year profit would be hit by unfavourable exchange rates and increased bad debt provisions.

Shares closed down 21.69 per cent at 1,664p yesterday as analysts downgraded their forecasts.