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Temporary power firm Aggreko on track for profit goal

Published 15/04/2014, 12:35

By Li-mei Hoang

LONDON (Reuters) - Aggreko , the world's biggest temporary power provider, said was on track to meet its profit expectations for 2014, helped by events such as the football World Cup, after posting a 5 percent rise in first-quarter group revenue.

The British firm, whose equipment powers major events and covers electricity shortfalls, said it had seen an 11 percent revenue rise at its power equipment rental business, with strong growth in Northern Europe, the Middle East and Russia.

Aggreko said earlier in the year that it expected 2014 operating profit to be unchanged at around 312 million pounds , after profit fell 8 percent in 2013.

Shares in Aggreko were up by 2 percent by 1129 GMT, having risen by more than 6 percent earlier in the session, making the company one of the highest risers on the FTSE 100 index <.FTSE>.

"We've had a strong order intake ... but we're not seeing a fundamental shift in the marketplace and emerging markets remain challenging," said Chief Financial Officer Angus Cockburn.

"We also are getting geared up for a busy summer of events,"

Cockburn said, citing the football World Cup in Brazil and the Commonwealth Games in Scotland as the main drivers of growth in the second quarter.

Cantor Fitzgerald Analyst Caroline de La Soujeole orders had continued to be strong into the second quarter.

"The start of Q2 has been strong in our view with nearly 200 mega watts of orders resulting in year to date order intake of 406 mega watts which compares with 260 mega watts at the same stage last year," she said.

Aggreko said first-quarter order intake was up by 150 megawatts year-on-year, after the company won contracts to supply 120 mega watts of energy to Libya and 50 mega watts of heavy fuel oil to Senegal.

Revenue from Aggreko's power projects business, which operates temporary power plants, fell 3 percent in the first quarter due to the completion of shorter-term contracts with Indonesia and Japan which were only partially offset by new contracts in Mozambique and Ivory Coast.

Trading in Asia Pacific remained weak, with revenues down 21 percent, largely driven by a slowdown in the Australian mining sector.

(Reporting by Li-mei Hoang, Editing by Erica Billingham)

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