Via Scott Wright
After the company said it had agreed to revised terms for the contract to supply power to the Tokyo Olympic and Paralympic Games, shares in Aggreko closed up more than four percent last night.
Aggreko, headquartered in Glasgow, which has a long history of supplying control for major sporting events, said yesterday that the renewed deal with the organizing committee of Tokyo will now be worth the group’s earnings of around $315 million.
Since the Tokyo Games, which were scheduled to be held last summer, were postponed because of the coronavirus pandemic, the deal was renegotiated. It is now planned that they will be held this year in July and August.
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Originally, the deal was reported to be worth $200 million to the temporary power producer when Aggreko first revealed it in December 2018. The contract, which will see 43 competition venues, the Athletes’ Village and the International Broadcast Center operated by the company, was then priced by the company last April at $250 million.
It is now worth $315 million, with the new adjustment representing the effect of the delay of the Games, including costs incurred by the company to provide workers in Japan with storage space, offices and accommodation. In the scope of work, there were also several improvements.
Aggreko reveals that 500 people will be working at the Tokyo Games.
In April 2019, Chief Executive Chris Weston said that when the Games take place, Aggreko could potentially hire up to 500 people on site in Japan. As plans ramp up in response to travel restrictions related to the corona virus, the organization is expected to steadily raise the number of employees in the nation over the coming months.
The company reiterated its profit estimate for the current year of £ 170 million to £ 190 million, which “assumes the Games go ahead as planned with this increased total contract value.”
At 666.5 pence, shares closed up 27 pence, or 4.2 percent.