Climate spending poised to propel AEA

By John O’Doherty
Published: June 12 2009 03:49

Heavy spending by the Obama administration on environmental measures will boost sales at AEA Technology, the energy and climate change consultancy said, as it digests its recent acquisition of PPC, a US-based environmental data group.
“The stimulus package that [President] Obama has put forth includes $40bn (£24bn) to invest in emerging technologies and energy efficiency initiatives,” said Mike Nigro, former chief executive of PPC and now chief operating officer at AEA.
“The administration has already appropriated much of the monies and we’ve written six proposals already for $150m that we couldn’t have written had it not been for the AEA capabilities ... over the next three years we see about $2bn worth of opportunities that we now can go after because of the relationship between AEA and PPC.”
So called “secure sales” – a measure of orders received by the company to date that are expected to be delivered in the coming year – stand at £57.5m ($95.3m), up 14 per cent from the £50.5m reached this time last year.
AEA Technology grew out of a subdivision of the UK’s Atomic Energy Association, advising the British government on measures to reduce smog in London in the 1950s. It now advises the UK’s Climate Change Committee and consults with governments and private sector organisations in Europe and China on environmental policy.
Andrew McCree, AEA’s chief executive, said the acquisition of PPC would add expertise from the US in the collation and analysis of emissions and climate data to PPC’s existing skills in policy formulation in Europe. “The two markets are at different points in their cycle,” he said.
“In the US, they’re starting to formulate policy, whereas in the UK, the policy is all done and in place, and it’s now in the space of implementation.”
For the full year ending in March, pre-tax profit fell 6 per cent to £7.5m on revenues that increased by 16 per cent to £93.7m. much of the profit decline was due to a £2.2m investment in sales and marketing operations, and AEA’s operating profit increased by 5 per cent to £10.4m.
Shares in AEA Technology closed up 1¾p at 22¾p on Thursday.
Copyright The Financial Times Limited 2009