Profits leap at Aggreko as it shrugs off 2012

ENGINEER Aggreko topped the FTSE yesterday, as a rise in full-year profit helped it reassure investors after a difficult end to last year.

The temporary power provider, whose kit powers major events and covers electricity shortfalls, left investors reeling as it issued two profit warnings late last year. In December, it warned of slowing revenues in 2013, with the absence of the Olympics effect and a reduction of US troops in Afghanistan taking £100m off revenues.

Yesterday, Aggreko bounced back to post an 11 per cent rise in pre-tax profit to £365m for 2012, on revenues 13 per cent higher at £1.6bn.

The firm, which supplied generators to the London Olympics, said growth of more than 30 per cent in the emerging markets had propped up profits.

Investment in the developing economies will be a key focus this year for the firm, as rising demand for power has pushed up business for companies such as Aggreko.

Its local business division, which operates mainly in mature markets, was boosted by a strong performance in North America, with reported revenues up 23 per cent overall.

In the year to date, the group has inked two new power contracts, in the Caribbean and in Dijbouti, although Aggreko noted that trading in the power project unit continued to be subdued. The FTSE firm also pledged a 15 per cent rise in its final dividend to 23.91p a share.

Shares closed up 10.3 per cent yesterday at 1,939p, making it the biggest riser on the FTSE 100, although the stock is still 17 per cent lower than their peak last year.