Glasgow-based international mobile power provider Aggreko said in a trading update that it expects its 2016 full year results to be broadly in line with current market expectations, with a pre-exceptional profit before tax of around £225 million.

But Aggreko said its business environment over the last nine months has been challenging, with tough conditions in upstream oil and gas in North America, contract negotiations in Argentina and payment problems in Venezuela.

Aggreko shares fell about 2.5%.

Aggreko said its underlying revenue for the third quarter was 7% behind last year.

Revenue from its rental solutions business in the third quarter was also down 7% on last year. 

“North America revenue was materially lower year on year driven by the ongoing weakness in upstream oil and gas with further pricing pressure and a reduction in gas volumes,” said Aggreko.

“Given this continued decline we are reviewing the carrying value of specialist equipment for the oil and gas market, notably our small gas generators.”

Aggreko said that outside North America, the rental solutions business had performed well, with growth in Europe and “Australia Pacific.”

“Our temperature control business has also performed well, up 5% in the quarter including the two acquisitions we have made in the last year,” said the firm.

The company added: “The payment situation in Venezuela continues to be very challenging. 

“However, discussions with both our customers are regular and constructive, and we have had success in getting some of our overdue invoices converted into a debt instrument.”