Amid the raging debate over energy prices, SSE (SSE) is retaining its focus on its “core financial objective” of delivering real dividend growth. The ‘big six’ energy provider confirmed it was on track to grow its full-year dividend by more than inflation and to deliver above-inflation dividend increases in the years to come. SSE is one of only five companies to have delivered above-inflation dividend hikes every year since 1999 and it looks as if it intends to maintain that track record - despite recent calls for energy price freezes and windfall taxes.
The reported figures were hit by big swings in derivative fair values that statutory accounting rules require SSE to recognise. But, on an adjusted basis, pre-tax profit fell 12 per cent to £354m and adjusted EPS dropped 17 per cent to 29.4p. Broker Whitman Howard expects adjusted full-year EPS of 123.5p and adjusted pre-tax profit of £1.5bn (from 118p and £1.41bn in 2013).
The retail division made an £89.4m operating loss, compared with an operating profit of £75.3m last year. Within that, energy supply - the focus of recent political criticism- delivered an operating loss of £115.4m, reflecting higher wholesale gas, distribution, environmental and social costs. Although this weaker performance was somewhat offset by increased profits in the networks and wholesale divisions.
SSE (SSE) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,406p | MARKET VALUE: | £13.6bn | |
| TOUCH: | 1,406p-1,407p | 12-MONTH HIGH: | 1,690p | LOW:1,363p |
| DIVIDEND YIELD: | 6.0% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 323p* | NET DEBT: | 147% | |
| Half-year to 30 Sep | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 11.4 | -40.9 | 1.70 | 25.2 |
| 2013 | 13.6 | 336 | 38.6 | 26.0 |
| % change | +19 | - | +2,171 | +3 |
Ex-div: 22 Jan Payment: 21 Mar *Includes intangible assets of £1.0bn, or 104p a share | ||||
