TIDMAPR
RNS Number : 8139E
APR Energy PLC
15 April 2014
15 April 2014
APR Energy plc (the "Company")
Annual Report and Accounts and Notice of Annual General
Meeting
Following the release on 26 March 2014 of the Company's
preliminary full year results announcement for the year ended 31
December 2013 (the "Preliminary Announcement"), the Company
announce that it has published its Annual Report and Accounts for
2013 (the "Annual Report and Accounts").
The Company's 2014 AGM will be held at JP Morgan Cazenove,
Holborn Bars, London, EC1N 2NQ on Tuesday 20 May 2014 at 10.00
am.
Copies of the Annual Report and Accounts and the Notice of the
Annual General Meeting 2014 are available to view on the Company's
website: www.aprenergy.com/investors
In accordance with Disclosure and Transparency Rule 6.3.5(2)(b),
additional information is set out in the appendices to this
announcement. This information is extracted in full unedited text
from the Annual Report and Accounts.
The Preliminary Announcement included a set of condensed
financial statements and a fair review of the development and
performance of the business and the position of the Company and the
Group.
In accordance with Listing Rule 9.6.1, a copy of each of the
Annual Report and Accounts, the 2014 Notice of Annual General
Meeting and the form of proxy in relation to the 2014 Annual
General Meeting has been submitted to the Financial Conduct
Authority via the National Storage Mechanism and will be available
for viewing shortly at www.Hemscott.com/nsm.do
Enquiries:
APR Energy plc
Karen Menzel Director of Investor Relations +44 (0) 777 590 6076
Andrew Bradshaw Company Secretary +44 (0) 207 725 0800
About APR Energy
APR Energy is the world's leading fast-track mobile turbine
power business. We provide large-scale, fast-track power, providing
customers with rapid access to reliable electricity when and where
they need it. APR combines state-of-the-art, fuel-efficient
technology with industry-leading expertise to provide turnkey power
plants that are rapidly deployed, customisable, and scalable.
Serving both utility and industrial segments, APR Energy provides
power generation solutions to customers and communities around the
world, with an emphasis on Africa, the Americas, Asia-Pacific, and
the Middle East. For more information, visit the company's website
at www.aprenergy.com.
Appendices
Appendix A: Directors' responsibility statement
The following directors' responsibility statement is extracted
from the Annual Report and Accounts (page 74).
Directors' responsibility statement required by DTR 4.1.12R
We confirm that to the best of our knowledge:
-- the financial statements, prepared in accordance with
International Financial Reporting Standards, give a true and fair
view of the assets, liabilities, financial position and profit or
loss of the Company and the undertakings included in the
consolidation taken as a whole;
-- the strategic report includes a fair review of the
development and performance of the business and the position of the
Company and the undertakings included in the consolidation taken as
a whole, together with a description of the principal risks and
uncertainties that they face; and
-- the Annual Report and financial statements, taken as a whole,
are fair, balanced and understandable and provide the information
necessary for shareholders to assess the Company's performance,
business model and strategy.
On behalf of the Board
John Campion Andrew Martinez
Chief Executive Officer Chief Financial Officer
25 March 2014 25 March 2014
Appendix B: A description of the principal risks and
uncertainties that the Company faces
The following factors and other information contained in this
Annual Report should be carefully considered. The following is a
description of the risks that may affect some or all of the Group's
activities and which may affect the value of an investment in the
Company's securities. If any of the events described below occurs,
the business, financial condition or results of operations of the
Group could be adversely affected in a material way.
Additional risks and uncertainties that the Group is unaware of,
or that it currently deems immaterial, may also in the future have
a material adverse effect on the Group's business, results of
operations and financial condition.
Key Risk Description Impact Mitigation
-------------------- --------------------------- ------------------------- ---------------------------------
Strategic
-------------------- --------------------------- ------------------------- ---------------------------------
Failure to The Group's strategy The inability to A detailed annual operating
deliver the is primarily based deploy successfully plan has been established,
growth plan on organic growth capital into new approved by the Board,
envisaged via the deployment projects and maintain and is monitored monthly.
as of capital into its growing fleet - A longer range (3-5
part of the new temporary power could have a material year) plan has been
recent capital projects that are adverse effect put in place and is
injections value accretive. on the financial updated annually to
This organic growth results of the incorporate market
is dependent on Group. changes.
the Group's ability - Regional business
to effectively development organisation
secure new projects fully deployed and
and to scale the operational. Pace of
infrastructure capital expenditures
of the business is aligned with the
to support execution. commercial pipeline.
-------------------- --------------------------- ------------------------- ---------------------------------
Contracts The Group operates Assets may be idle - The Group's commercial
are temporary in an industry for a period of team takes a dual approach,
in nature where the majority time before they which involves pursuing
of contracts are are redeployed contract extensions
short-term (typically in a revenue generating with existing customers
12 -18 months) capacity. whilst also pre-marketing
and there are no assets that may soon
assurances that become available.
any particular - A commercial pipeline
customer will renew process tracks new
or extend a contract. contract opportunities
from opportunity identification
through to final contract
signature.
- Asset utilisation
models are used to
manage fleet assets.
-------------------- --------------------------- ------------------------- ---------------------------------
Asset concentration Given the scale Any such loss of - The Group is pursuing
of the Group's, a major customer a strategy of geographic
albeit growing, contract could and market diversification
customer base, materially impact as demonstrated via
the loss of any revenues and associated our hub strategy, with
single major customer, profitability. a focus on continued
and/or high concentration expansion of its customer
of assets could base in order to lessen
have an adverse the impact of any single
impact on the results customer loss. The
of its operations. placing of assets across
multiple sites, helps
to mitigate the impact
pertaining to any given
location.
- Commercial opportunities
are segmented across
regions, customer segments
and technology to align
with strategic growth
objectives.
- The Group maintains
a regular dialogue
with major customers
at a senior level to
help understand and
anticipate their future
plans.
- The acquisition of
the GE Power Rental
Business increased
the scale and diversification
of APR Energy's business.
-------------------- --------------------------- ------------------------- ---------------------------------
Key Risk Description Impact Mitigation
------------------- ------------------------ ----------------------------- ------------------------------
Market
------------------- ------------------------ ----------------------------- ------------------------------
Global political The global footprint Declines in economic - The Group is pursuing
and economic of the Group's activity, slowing a strategy of geographic
conditions business exposes of growth rates and market diversification
it to risks of and customer access with a focus on continuing
change in economic to funding could to expand its customer
conditions and impact the growth base in order to lessen
political regimes. strategies of the the impact of economic
business. cycles and/or political
changes.
Additionally, changes - A commercial pipeline
in political regimes process has been established
pose potential to track new contract
risk to existing opportunities and includes
contracts and/or risk management elements.
the timing of potential - APR recognises that
new contract opportunities. some of the countries
in which it operates
have experienced political,
social, economic and
security instability.
The Group is proactive
about mitigating all
or a portion of its
international currency
and asset exposures
through various risk
mitigation tools, including
the use or purchasing
of insurance, bonds,
guarantees, and cash
advances to protect
its assets, both financial
and operational.
------------------- ------------------------ ----------------------------- ------------------------------
Volatility Customer demand Fluctuating demand - By developing a global
in customer inherently fluctuates can create volatility expanded customer base,
demand, including and, in many cases in trading results. the impact of any single
event driven it is driven by Higher margin event event can be mitigated.
demand external events (emergency) driven - A regional hub strategy
that are difficult contracts may not has been implemented
to predict. be sustainable to help ensure that
on a consistent equipment is available
basis. nearby to customers
and that it is able
to be utilised in the
event that a short-term
market opportunity
arises.
------------------- ------------------------ ----------------------------- ------------------------------
Increase in While barriers New entrants may - The Group's commercial
competitive to entry in the create pricing team regularly monitors
environment temporary power pressure in the competitive activity
space remain high, market and lead and publicly available
there is the potential to reduced margins. pricing dynamics to
for new or expanding help understand changes
entrants to compete in the market.
with the Group. - The Group focuses
on maintaining a world-class
competitive offering
using best-in-class
technology.
------------------- ------------------------ ----------------------------- ------------------------------
Key Risk Description Impact Mitigation
-------------------- ----------------------------- ---------------------------- --------------------------------
Operations
-------------------- ----------------------------- ---------------------------- --------------------------------
Asset security The Group's operations The potential exists - The Group maintains
are highly capital for nationalisation, a comprehensive global
intensive and, expropriation and/or property insurance
in many cases, theft of high-value programme.
projects require assets. - In addition, there
the placement of is a global political
high-value equipment risk insurance programme
into volatile environments. that can be implemented
on a country-by-country
basis to protect against
government actions
relative to assets
such as expropriation
or nationalisation.
- In many cases, standby
letters of credit from
customers are required
for asset security.
-------------------- ----------------------------- ---------------------------- --------------------------------
Focus on developing The Group's operations This may expose - The Group has instituted
markets - are highly decentralised the Group to unethical a comprehensive compliance
operations and in many cases behaviour and potential programme that includes
in difficult the Group operates legal/regulatory a broad anti-corruption
regions of in regions of the violations that policy, extensive training,
the world world where corruption could have a significant and monitoring on a
and bribery are financial and reputational regular basis, with
commonplace. impact. all new employees required
to undertake training
upon joining.
- Third-party agents/
contractors are thoroughly
vetted prior to any
engagement and are
required to provide
compliance certifications.
-------------------- ----------------------------- ---------------------------- --------------------------------
Recruitment The Group depends The loss of key - Competitive remuneration
and retention on the recruitment senior individuals policies, including
of key staff and retention of in the organisation a performance share
key senior management or the inability plan, have been put
in order to effectively to recruit sufficient in place to attract
manage the business. talent could jeopardise and
APR Energy's ability retain key personnel.
to execute its - A talent review and
growth plans. development process
is in place across
the organisation with
a focus on providing
growth opportunities
across the organisation.
-------------------- ----------------------------- ---------------------------- --------------------------------
Environment, The Group's operations Plant personnel - The Group has implemented
health and involve the movement, could be subject comprehensive health
safety installation, and to safety hazards and safety policies
operation of large that lead to injury and procedures at all
electrical equipment, or loss of life. sites. An extensive
which often operates training programme
at high voltage. Operations could has been rolled out
be subject to an to all personnel.
In addition, the accidental spill - The Group has strengthened
handling of fuel, of fuel or other its security arrangements,
oil and other hazardous hazardous materials. including the introduction
materials is a of a Group Security
common part of Director, Country security
the day to-day managers in higher-risk
activity. countries and the introduction
of a Group security
standard setting out
mandatory principles
and procedures for
all our locations.
- The development of
environment, health
and safety performance
indicators is ongoing
and will be reviewed
regularly with the
Board.
-------------------- ----------------------------- ---------------------------- --------------------------------
Key Risk Description Impact Mitigation
---------------- ------------------------- --------------------------- -------------------------------
Financial
---------------- ------------------------- --------------------------- -------------------------------
Movements The business model Changes in the - The Group has two
in cost inputs is dependent on cost of key inputs key supplier framework
the procurement could have a material agreements with GE
of capital equipment, adverse effect and Caterpillar that
services, labour on the operating have fixed pricing
and other cost margins of the and are indexed to
inputs to operate business. an annual inflation
temporary power indicator thereafter.
plants around the - Significant cost
world. efficiency projects
are underway to post
standby, and in some
cases, documentary
letters of credit as
payment security.
---------------- ------------------------- --------------------------- -------------------------------
Payment default The Group has a Delay in payments - Prior to contracting
number of contracts or default could with a customer, a
with customers adversely affect thorough risk assessment
in developing countries the financial performance is completed including
where payment practices of the business. a credit risk review.
can be lengthy - In many cases, the
and unpredictable. Group requires the
customer to post standby,
and in some cases,
documentary letters
of credit as payment
security, decreasing
the impact of any individual
contract default.
- The Group's strategy
is focused on increasing
the scale and diversification
of the business.
---------------- ------------------------- --------------------------- -------------------------------
Funding risk The business model Adverse changes - The Group increased
is dependent on affecting access its credit facility
external funding to funding or the to $650 million during
for the procurement higher costs associated 2013 with its group
of capital equipment, with replacing of lending banks. The
services, labour, maturing debt could credit facility includes
and other costs have a material provisions allowing
to operate the adverse effect for amendments to be
business. on the business. requested, if necessary.
- The Group enjoys
good ongoing relationships
with its lenders and
has commenced discussions
regarding its refinancing
strategy in light of
the term-loan which
matures on 1 January
2015.
- Alternative financing
opportunities which
are available to APR
Energy are continuously
evaluated by the Group.
---------------- ------------------------- --------------------------- -------------------------------
Appendix C: Related party transactions
The following related party transactions are extracted from the
Annual Report and Accounts (page 122).
Transactions between the Company and its subsidiaries, which are
related parties, have been eliminated on consolidation and are not
disclosed in this note.
JCLA Holdings LLC is a related party due to its owners being the
CEO and COO of APR Energy plc. Consulting services from JCLA
Holdings LLC (and its subsidiaries) were incurred by the Group
during the year. These consulting services were made at an arm's
length market price. The total expense for the year was $0.4
million (2012: $0.3 million). The services rendered were all paid
in cash. No guarantees have been given or received.
CJJ LLC is a related party due to its owner being the CEO of APR
Energy plc. CJJ LLC provides travel arrangement services to the
Group. These services were made at an arm's length market price.
The total expense for the year was $0.3 million (2012: $nil). The
services rendered were all paid in cash. No guarantees have been
given or received.
JCLA Development II LLC is a company related by common control
by the CEO and COO. JCLA Development II LLC rents office space to
the Group. These rental services were made at an arm's length
market price. The total expense for the year was $nil (2012: $0.1
million). The services rendered were all paid in cash. No
guarantees have been given or received.
Remuneration of key management personnel
The remuneration of key management personnel of the Group is set
out below in aggregate for each of the categories specified in IAS
24 Related Party Disclosures. Further information about the
remuneration of certain key management personnel is provided in the
audited part of the Directors' Remuneration Report on pages 75 to
91.
$ million 2013 2012
-------------------------------------------- ----- -----
Remuneration 7.0 2.5
Post-employment benefits - -
Other long-term benefits 0.1 0.1
Termination benefits - 0.9
Equity-settled share-based payment expense 2.8 0.8
-------------------------------------------- ----- -----
9.9 4.3
-------------------------------------------- ----- -----
The group of individuals designated as key management personnel
has been expanded from 5 to 9 individuals in the current year.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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