Aggreko Share Discussion Threads

[phil140158] 16/10/2009 06:18

eipgam, you've probably seen this: Noble - neutral, KBC Peel Hunt - hold

[phil140158] 15/10/2009 21:56

eipgam, I saw a note from Charles Stanley on the ADVFN Evening Euromarkets bulletin. They are forecasting a 10% increase in profit for 2009, but holding there 2010 forecast at 190m. 'The market remains very attracted to Aggreko, but at 15.2x our forecast for next year, the price is high enough' IMHO, I wouldn't argue with that, what do you think?

[eipgam] 15/10/2009 11:16

if anyone sees any broker notes in the next few days, please post them here.

[philo124] 15/10/2009 09:14

WELL DONE TO THOSE THAT HELD ON. I DIDN'T BUT THERE YOU GO!

[bountyhunter] 11/10/2009 16:52

also 4.37 pence per share to be paid out on 23 Oct.

[mattjos] 08/10/2009 23:49

only another 20p or so to new all time high and then looks like quick breakout into blue sky to 850-900 .. cant keep a good business like this down. hardly a traders stock i suppose but a cracking business. Won't be long before they start using fuel cells i imagine either. their brand is so strong it's about the only name one thinks of for energy gensets & looks like it will run & run here.

[eipgam] 17/9/2009 13:15

very nearly back to all time high...

[bountyhunter] 04/9/2009 17:18

nice rise today :)
"Go to Discussion" quick link added at top of header.

[edjgee] 03/9/2009 21:17

Hold this one too. A pretty resilient outfit. Weird weather and the big events it gets contracts for help it along

[mattjos] 25/8/2009 22:19

Just a no-brainer this share in terms of buy & hold from here. Energy market seems on a long term bias towards demand exceeeding supply (until nuclear becomes more acceptable) & this company has the brand awareness the world over to be considered by most companies requiring power ..... you look back & struggle to see why this was ever marked down last year. Results in line with managment forecasts & well set to flourish med to long term ..... one day maybe, someone will have a bid for this outfit. Till then they look well placed & well run. I Hold

[bountyhunter] 25/8/2009 17:20

I must confess that second leg up this afternoon took me by surprise also! Maybe US investors buying in on the back of the results?
I guess inline results for the past 6 mths are looked upon pretty favourably currently and maybe a downturn had previously been discounted.

[scburbs] 25/8/2009 17:15

Ouch! That is some rise on results and outlook exactly in line with a trading statement from June! I can feel my fingers starting to burn, luckily they are being cooled by my holdings in UK commercial property companies.

[bountyhunter] 25/8/2009 13:59

H1 was down 13% for local businesses and 40% up for International.
It's a tale of two markets, fortunately the International market has been growing despite the global downturn; when the global economy begins to recover then AGK should be well positioned in both markets. imho dyor

[scburbs] 25/8/2009 12:46

See below extract illustrating the above point about long term contracts meaning the international power business lags the cycle. The level of renewals seems to be the key to whether current profit levels are sustainable.

"Our order book has decreased from a peak of 22,000MW at June 2008 to just over 18,000MW at June 2009 which is equivalent to about 10 months revenue at the current run-rate. This decline is due in part to a reduction in the months remaining on a number of large multi-year contracts."

[scburbs] 25/8/2009 12:39

Bountyhunter,

It appears that the market agrees with you. Still looks like an accident waiting to happen to me! I think I will wait for £7 before increasing my short though!

International power business is on much longer term contracts so lags the market (i.e. local power businesses turned down with avengance in Q2, but the international power business with longer term contracts will turn later).

The market clearly believes that the international power business will make it through the cycle without a signficant downturn.

I would have expected economic contraction to reduce power demands on utilities. If demand falls then they should reduce their supplies of temporary power. Seems logical to me, although perhaps demand will pick up before the contracts expire, therefore, meaning they will be renewed.

[bountyhunter] 25/8/2009 11:34

The interims look good to me especially given the state of the global economy, and the market seems to like them judging by the share price reaction.
I've added some detail including re the divi for future reference into the header.

[scburbs] 25/8/2009 10:35

Q1 was flat in local businesses and 51% up in International per IMS below.

H1 was down 13% for local businesses and 40% up for International. This shows that Q2 revenue was appalling in the local businesses (perhaps down 25%), whereas growth in International was slowing to a still very strong c.30%. However, outlook seems to be for International to continue to slow.

"The Group has had a strong start to 2009 with total revenues in the three months to 31 March 2009 growing by 42%. On a constant currency basis and excluding pass-through fuel, Group revenues grew by 17%, with the Local businesses trading at similar levels to last year and the International Power Projects business growing by 51%."

[scburbs] 25/8/2009 10:31

A tail of two businesses.

The local businesses are on the floor and the results are flattered by a reasonable Q1 performance. Rates are falling quickly which will fall through to the bottom line going forward.

The international business remains very strong, but growth is set to slow.

Local Businesses

"After a reasonable first quarter, conditions deteriorated in the second quarter, and there are no signs of improvement so far in quarter three." [North America]

"As in North America, after a reasonable first quarter, conditions deteriorated in the second quarter, and there are no signs of improvement so far in quarter three." [Europe & Middle East]

"We expect that conditions in the Local business will continue to be challenging particularly compared with a very strong second half in 2008 when we had the benefit of both the Beijing Olympics and exceptionally high storm-related revenues in North America. We have deliberately sought to defend and, where possible, increase our market share and we currently have more power on rent in our Local businesses than we did a year ago. However in achieving this, rates have weakened noticeably. Our temperature control business is having a poor summer season in both North America and Europe, with low ambient temperatures and few customers suffering the capacity constraints which drive demand for additional cooling. Our response to this challenging environment has been to restrict new fleet investment and to reduce headcount in our worst-affected Local businesses."

International Business

"In International Power Projects we have recently been awarded some sizeable new projects, including an additional 140MW in Kenya and 100MW in Saudi Arabia. Project extensions continue to run at a healthy rate, but converting enquiries for large new projects into finalised contracts remains difficult in many territories. During the second half of 2008 we significantly increased the amount of MW on rent, but, as expected, net increases during the first half have run at more modest levels. We anticipate that net additions on rent in the second half will continue at this lower rate, and as a consequence, we expect the business will grow year-on-year during the second half but at a noticeably slower pace than that seen in the first half."

[peterbill] 25/8/2009 10:07

From today's half yearly results ...

Strong first half, with sharply improved trading margins and return on capital employed ....

Interim dividend increased by 15% ...

notable new contract wins, including 140MW in Kenya, 100MW in Saudi Arabia, 30MW in Ethiopia and 20MW in Guadeloupe ....

Local business revenue, in constant currency, decreased by 13% and trading profit by 29% reflecting challenging market conditions ...

Outlook for 2009 unchanged with profits in constant currency expected to be similar to 2008 despite tough H2 comparatives with Beijing Olympics and exceptional US storm revenues in 2008 ...

Philip Rogerson, Chairman, commented:


"In the first half of 2009, Aggreko delivered another strong performance,
despite the difficult economic conditions, producing increased trading margins
and returns on capital employed."

[scburbs] 24/6/2009 12:53

"Aggreko downgraded to hold from buy at Panmure Gordon, target price cut to 514p from 600p
Business Financial Newswire
Downgrade is despite an overall good first half. Broker sees a tougher H2 ahead. Says it's 'a mixed bag behind the scenes and one which raises a number of concerns about H2 and the full year despite no change to forecasts.

'Local business appears under pressure for H2 from both volume and pricing perspectives, and after a period of considerable good news with and contract wins this update may be taken as Aggreko pausing for breath.'

Shares 485.75p after opening down 10.5p at 514p."

ADVFN competitor.com/action/news/showArticle?id=3631483

[scburbs] 23/6/2009 08:11

At 31 March headline revenues were 42% ahead and constant currency 17%

At 30 June this becomes 20% ahead and constant currency 5%

This looks suspiciously like Q2 revenues were down on an actual and constant currency basis.

In the local businesses (constant currency), North America 5% growth in Q1 has changed to 10% down after H1. In Europe flat in Q1 has turned out as 11% down after H1. The remaining local businesses are substantially down, but largely due to the Olympics in the comparatives.

International Power Projects continues to power ahead. After Q1 constant currency growth was 51% and this has moderated only to 40% after H1 (although clearly Q2 was a lot slower to bring the average down). H2 is guided to grow, but at a noticeably slower rate.

Overall, the downside risks to AGK's profit numbers appear to be increasing.

[scburbs] 23/6/2009 07:59

First move towards downgrading future expectations? No actual downgrade, but indications that one is in the pipeline as this is a noticeable weaker statement than the IMS. Overall H1 in constant current is revenue up 5% and trading profit up 15%.



"We expect that revenues [in local businesses] in constant currency in the first half will be about 10% lower in North America; about 11% lower in Europe and the Middle East; and at similar levels to last year in Aggreko International's Local Businesses, adjusted for the impact of the Olympics (-20% unadjusted). Looking ahead to the second half, we expect that conditions in the Local Business will continue to be challenging, and will compare with a very strong second half in 2008, when we had the benefit of both the Olympics and very high storm-related revenues in North America.

International Power Projects, on the other hand, continues to trade strongly. We expect that this business will grow its revenues in the first half, in constant currency and excluding pass-through fuel, by around 40%, and by over 80% in sterling terms. Whilst the rate of signings of new projects has slowed, the prospect pipeline remains strong. Project extensions are running at a healthy rate, and margins in the first half are likely to be at record levels. In the second half we expect the business will continue to grow but, given the very large number of new projects commissioned in the second half of 2008, it will be at a noticeably slower rate.

Overall, the Board maintains the guidance for the year given at our Preliminary Results in March, which was that we expect that profits in constant currency will be at similar levels in 2009 to those achieved in 2008. Capital expenditure is likely to be somewhat lower than previous expectations at £170m, in part due to currency movement. We also expect that the business will be strongly cash generative this year."

[eipgam] 18/6/2009 13:06

Hi Bd... I've followed that link but cannot see anything about AGK