Key Performance Indicators

The Group uses a large number of performance indicators to measure day-to-day operational and financial activity in the business. Most of these are studied on a daily, weekly or monthly basis. A well developed management accounts pack, including profit and loss statements as well as key ratios related to capital productivity and customer satisfaction scores, are prepared for each profit centre monthly. In addition, every general manager in the business receives a weekly and monthly pack of indicators which is the basis of regular operational meetings.

There are five Key Performance Indicators (KPIs) which we use as measures of the longer-term health of the business and which we use to monitor progress in implementing the Group's strategic objectives. They are:

• Safety
• Return on average capital employed
• Earnings per share
• Customer loyalty
• Staff turnover

Safety

Our business involves the frequent movement of heavy equipment which, in its operation, produces lethal voltages and contains thousands of litres of fuel. Rigorous safety processes are absolutely essential if we are to avoid accidents which could cause injury to people and damage to our reputation and property. Safety processes are also a basic benchmark of operational discipline and there is, in our view, a close correlation between a well-run business and a safe business.

The main KPI we use to measure safety performance is the internationally recognised Frequency Accident Rating ('FAR') which is calculated as the number of lost time accidents multiplied by 200,000 (being the base for 100 employees working 40 hours per week, 50 weeks per year) divided by the total hours worked. A lost time accident is a work related injury/illness that results in an employee's inability to work the day after the initial injury/illness.

The Group's FAR during 2011 was unsatisfactory, in that it increased markedly over the previous year. It is still better than the benchmark of 1.1 reported for US rental and leasing industries published by the US Department of Labor in 2010, but we expect to be much better than the rest of the pack, and we are dissatisfied with being only a little better. It is perverse that this statistic should get worse in a year in which safety processes have been strengthened in many areas: in particular, our manufacturing operation achieved OHSAS 18001 certification in 2010, yet saw a sharp increase in FAR in 2011.

After a disappointing year, in which our FAR performance has come perilously close to being merely average for our industry, we intend to re-double our efforts in 2012 to make Aggreko a safer place to work in 2012.

Further discussion of Health & Safety matters can be found in this report within the Principal Risks and Uncertainties, Safety section.

FAR was as follows:

Finally, it is with great sadness that we report that we had our first fatality ever in Aggreko; in Mauritania, a service technician, being driven home at the end of his shift by a professional driver, was involved in a serious car crash and later died of his injuries. Our thoughts and condolences go out to his family.

Return on average capital employed

In a business as capital intensive as Aggreko's, profitability alone is a poor measure of performance; it is perfectly possible to be generating good margins, but poor value for shareholders, if assets (and in particular, fleet) are being allocated incorrectly. We believe that, by focusing on return on average capital employed ('ROCE'), we measure both margin performance and capital productivity, and we make sure that business unit managers are tending their balance sheets as well as their profit and loss accounts. We calculate ROCE by dividing operating profit for a period by the average of the net operating assets as at 1 January, 30 June and 31 December.

ROCE was as follows:

ROCE in 2011 fell back to 28.0% due to the incresed levels of working capital and the mix of revenue with fewer major events (Vancouver Winter Olympics, FIFA World Cup and Asian Games) in 2011 which are less capital intensive. At 28.0%, ROCE is still at a high, and in our view, very attractive, level. The importance of ROCE as a measure for Aggreko is illustrated by the fact that it is included along with earnings per share as the basis for the Company's Long-term Incentive Plan details of which can be found in Performance Related Pay within the Remuneration Report.

Earnings per share

Measuring the creation or destruction of shareholder value is a complex and much-debated topic. We believe that Diluted EPS, while not perfect, is an accessible measure of the returns we are generating as a Group for our shareholders, and also has the merit of being auditable and well understood. So, for the Group as a whole, the key measure of short-term financial performance is diluted earnings per share pre-exceptional items ('Adjusted EPS'). Adjusted EPS is calculated based on profit attributable to equity shareholders (adjusted to exclude exceptional items) divided by the diluted weighted average number of ordinary shares ranking for dividend during the relevant period. EPS for the year was 10% ahead of the previous year and continues the significant growth in this measure since 2007.

Adjusted EPS was as follows:

Customer loyalty

The Group deals every year with thousands of customers, and we have developed a process by which we can objectively measure the performance of our business units, not only in financial terms but also the extent to which they are making customers feel inclined to return to us the next time they need the services we provide. We believe that near real-time measurement of our performance, as seen by our customers, gives us visibility of operational issues which might otherwise take months to emerge through the profit and loss account. Accordingly, we use the Satmetrix system whereby we send customers an email immediately after a contract closes asking them to fill out a detailed questionnaire about how they thought we performed. This data is then collated to conform to the same management structure as our profit and loss accounts so that, in monthly management accounts, we see not only a team's financial performance but also their operational performance as measured by how well their customers think they have done for the same period.

These questionnaires generate enormous amounts of data about how customers view our processes and performance and, in order to distil this down into a single usable indicator, we track a ratio called the Net Promoter Score (NPS). Broadly speaking, the NPS measures the proportion of our customers who think we do an excellent job against those who think we are average or worse. In 2011, around 20,000 questionnaires were sent out and we received over 5,000 replies: we believe that the scale of the response we get enables us to have confidence in this KPI.

Across the Group, our NPS over the last five years was:

Satmetrix, a global leader in customer experience programmes who manages over 11 million customer responses annually (including Aggreko's), have confirmed that our Net Promoter Score in 2011 was amongst the top 5 highest companies benchmarked world-wide in the business-to-business segment.

Staff turnover

In a service business such as Aggreko, it is the attitude, skill and motivation of our staff which makes the difference between mediocre and excellent performance. Staff retention therefore is a reasonable proxy for how employees feel about our company. We monitor staff turnover which is measured as the number of employees who left the Group (other than through redundancy) during the period as a proportion of the total average employees during the period. Staff turnover was slightly higher than the previous 2 years, but remains lower than in 2007 and 2008, and was as follows:

As well as measuring staff turnover, the Group carried out its third global opinion survey, conducted by an independant third party, in which every employee was invited to say what they thought about Aggreko. The results have again put Aggreko in the top quartile of employee satisfaction when compared to peer group companies. Despite over 1,000 new people coming into the business, the feedback from 3,600 responses received is overwhelmingly positive and an improvement in most areas on the previous survey. Aggreko continues to have a strong culture with highly committed people, demonstrated by:

• 91% of the respondents said they enjoyed their work;

• 90% were proud to work for Aggreko; and

• 84% found Aggreko an exciting place to work.