Aggreko grew first quarter revenue 18 percent compared to the first quarter last year. Excluding the impact of re-pricing and off-hires in Argentina, revenue growth was 7 percent and 25 percent respectively.
Rental Solutions revenue increased 3 percent year over year. Oil and gas sector revenues in North America have stabilized, Aggreko said. Although they were a third lower compared to the first quarter of 2016, they were up sequentially compared to the fourth quarter of 2016. All other sectors in North America grew, Aggreko said, with revenue excluding oil and gas jumping 8 percent. The wider Rental Solutions business also contributed to the growth, with a strong performance in Europe and a solid performance in Australia Pacific.
Power Solutions Industrial revenue hiked 17 percent with strong performances in Eurasia and the Middle East and a good performance in Aggreko’s industrial business in Africa. Asia and Latin America continue to be more challenging and Aggreko is working to downsize those businesses.
Power Solutions Utility revenue was 7 percent lower than last year because of repricing and off-hires in Argentina. Excluding the impact of Argentina, revenue grew 4 percent. Year-to-date order intake is 156 MW compared to 486 MW last, including 200 MW from Zimbabwe. While the project pipeline continues healthy and is at a similar level as 2016, conversion rates are currently running lower. The first quarter off-hire rate was 10 percent.
Aggreko has signed its first solar diesel hybrid contract of 7 MW, supplementing 20 MW of diesel already on contract, for a 10-year period.
Aggreko forecasts fleet capital expenditure of about £300 million (about U.S. $387 million). The company said because of the impact of Argentina, its profits before tax and pre-exceptional items will be lower in 2017 than 2016.
About the Author
Michael Roth
Editor
Michael Roth has covered the equipment rental industry full time for RER since 1989 and has served as the magazine’s editor in chief since 1994. He has nearly 30 years experience as a professional journalist. Roth has visited hundreds of rental centers and industry manufacturers, written hundreds of feature stories for RER and thousands of news stories for the magazine and its electronic newsletter RER Reports. Roth has interviewed leading executives for most of the industry’s largest rental companies and manufacturers as well as hundreds of smaller independent companies. He has visited with and reported on rental companies and manufacturers in Europe, Central America and Asia as well as Mexico, Canada and the United States. Roth was co-founder of RER Reports, the industry’s first weekly newsletter, which began as a fax newsletter in 1996, and later became an online newsletter. Roth has spoken at conventions sponsored by the American Rental Association, Associated Equipment Distributors, California Rental Association and other industry events and has spoken before industry groups in several countries. He lives and works in Los Angeles when he’s not traveling to cover industry events.