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Aggreko finds growth in emerging markets

There are “noticeable signs of weakness” emerging in the European market, according to temperature control and power specialist Aggreko.

The Glasgow-based firm has protected profit growth by concentrating on margins and developing revenues in emerging markets.

Aggreko specialises in providing temporary power alongside temperature control services including air conditioning, modular cooling towers, chillers, heat exchangers and electric heating.

In an interim results statement chairman Philip Rogerson said the company expects to exceed market expectation for profits this year despite conditions in Europe and North America.

Thanks to a “very strong” performance in emerging markets, revenue is up 18.8 per cent for temperature control services and 25.1 per cent for power services in the first six months of 2008.

Overall revenue was up 28.4 per cent at £407.7 million, including £9.1 million from the Beijing Olympics, with profit before tax up 41.9 per cent at £68.6 million.

Rupert Soames, chief executive, said: “We are expanding our reach, capability and scale to meet strong demand in emerging markets. The momentum we have developed in the Middle East, Asia, Africa and Central and South America will more than offset demand in North America and Europe and will enable us to deliver another very strong performance in the second half.”

In Europe margins were up, but there was only a 1.1 per cent rise in revenues and in the UK revenue was flat. 

Mr Soames said the company was facing “uncertain markets” in Europe and North America and expected revenues in the second half to be at a similar level to 2007. But the company expects this to be offset by a “very strong second half” for its international operations.