GLASGOW TEMPORARY power specialist Aggreko is poised to make a lucrative breakthrough in South Africa after the state-owned electricity group Eskom finally admitted that it needs outside help to deal with demand from the country's booming mining industry.

Aggreko currently has no significant business in the Republic, where power shortages have escalated to the stage where the giant Goldfields group last week threatened to lay off more than 6000 workers and said that current production has slumped by more than 20%.

It is understood that Aggreko is now in talks with a number of industrial leaders about supplying its equipment.

"Aggreko stole a march on its competitors a couple of weeks ago when it flew in its Africa specialist Andy Walker to address the African Mining Industry Indaba (get-together) in Cape Town," commented one leading broker.

"He warned of a looming power crisis and caught the attention of delegates representing more than 700 individual companies who now see the Scottish company as their first port of call."

Chief executive Rupert Soames is to deliver an update on the South Africa position on Tuesday when he is due to reveal a buoyant set of annual figures as a result of strong demand from other developing nations in Asia and South America as well as Africa.

Most analysts now believe annual pre-tax profits will show a near 50% increase to around £125.5 million and say that the group's Dubai-based International Power division will account for at least 60% of the total.

Brokers at Citi say that the anticipated increase in business from developing areas will comfortably outstrip any fall in demand in the US and have pencilled in £136.5m profits as a reasonable target for 2008.

Aggreko reckons it can cope with the increased business after its hire fleet grew by 40% last year through its acquisition of GE Rentals, though it is having to splash out heavily on new equipment.

Followers say the extra spending will be a mark of confidence in the future and say the company can easily afford the outlay because of its strong cash flow and favourable taxation charges.