Aggreko swings to loss in 2020 due to the COVID-19 disruptions

Written by: Wajeeh Khan
March 1, 2021
  • Aggreko swings to loss in 2020 due to the COVID-19 disruptions.
  • The Glasgow-based company reports £1.37 billion of revenue.
  • Aggreko declares 10 pence a share of final dividend on Monday.

Aggreko plc (LON: AGK) said on Monday that it concluded 2020 with a pre-tax loss as revenue slumped due to the ongoing Coronavirus pandemic that has so far infected more than 4.1 million people in the United Kingdom and caused over 122 thousand deaths.

Aggreko shares opened roughly 2% up on Monday but lost the entire intraday gain in the next hour. The stock now has a per-share price of £7.97 versus a low of £3.14 in March 2020, when the impact of the COVID-19 crisis was at its peak. The price action should come in handy if you are interested in investing in the stock market.

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Aggreko said that 2021 will see recovery from the COVID-19 driven hit, but activity is likely to take until 2022 to return to the levels seen before the health emergency. Aggreko’s financial update comes almost a month after it secured approval as an NCPA supplier of temporary power and conditioning.

Aggreko reports £1.37 billion of revenue in 2020

The power equipment supplier said that its pre-tax loss in 2020 came in at £73 million. In comparison, it had posted £199 million of profit in the previous year. According to FactSet, experts had forecast the company to report an even broader £80.7 million loss.

In separate news from the United Kingdom, distribution and outsourcing company, Bunzl plc, said on Monday that its pre-tax profit jumped 23% in 2020.

Aggreko valued its net loss in the recently concluded year at £111 million versus a much narrower £50.8 million expected. Its operating loss, on the other hand, stood at £39 million in 2020, compared to the previous year’s £241 million profit.

The Glasgow-based company said that it generated £1.37 billion of revenue in the recent year – a decline from £1.61 billion that it recorded in 2019. Its full-year revenue, however, matched what analysts had anticipated.

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Aggreko declares 10 pence a share of final dividend

Aggreko’s board declared 10 pence per share of final dividend on Monday. The total dividend for 2020 stood at 15 pence per share. As per the company, the dividend reflected strength of its financial stature and confidence in future performance.

Aggreko performed fairly downbeat in the stock market last year with an annual decline of close to 25%. At the time of writing, the FTSE 250 listed company now has a market cap of £2.04 billion.