Shares in Aggreko were down on the FTSE 100 in afternoon after the generator rental company reported record profits for 2010, but added that unrest in the Middle East added significant uncertainty to its outlook for 2011.
Revenue increased 20.1 per cent in the year ended 31 December 2010 to £1.2 billion and pre-tax profit jumped 24.6 per cent to £307.1 million.
Following the results Aggreko said it would be raising its total dividend 50 per cent to 18.90 pence per share.
The group said that it had an "outstanding year" having reaped £87 million in revenue from events such as the Winter Olympics, the Asian Games and the FIFA World Cup.
Aggreko's International Local Business arm performed particularly well with trading profit more than doubling to £55.9 million. Other arms also saw good growth however with North American trading profit rising 28 per cent to $72.4 million, European & Middle Eastern trading profit climbing 17.3 per cent to £41.8 million and the International Power Projects arm reporting trading profit growth of 4.9 per cent to $259.9 million.
Rupert Soames, Chief Executive of Aggreko, said, "2010 demonstrated the strength of Aggreko's business model. A hat-trick of major events has allowed us to deliver strong earnings growth while our International Power Projects business completely re-structured its order book and delivered the key strategic objective of improving the regional balance of business between Africa, the Americas and Asia. We go into 2011 with strong momentum, a record order book in International Power Projects, and continued strong demand driven by the world-wide shortage of power."
"We expect both International Power Projects and our Local businesses to deliver good growth on an underlying basis in 2011, and to support this, fleet capital investment in 2011 is expected to increase by 26% to a record £320 million."
Philip Rogerson, Chairman of Aggreko, added, "The current instability in some countries in the Middle East and Africa makes the task of predicting the outcome for the year more than normally difficult. Our global scale and diversification of risk exposures will be helpful as we manage through this period of uncertainty, and we anticipate that for the year as a whole trading profit in 2011 will be at a similar level to 2010. Allowing for currency movements and the £87 million of major events revenue in 2010 which will not recur in 2011, this would represent underlying growth of around 15%."
By 14:00 shares in Aggreko were down 6.92 per cent on the FTSE 100 to 1,386.00 pence per share.