Energy giant SSE (SSE) is preparing for record annual investment and capital expenditure of around £1.85bn next year. Following its sale of a 16.7 per cent stake in Scotia Gas Networks in October, management has announced plans to direct £100m towards construction of the 225 megawatt Stronelairg wind farm. The remaining proceeds will finance a share buyback of around £500m.
Favourable mark-to-market movements in the group's forward purchase contracts for power, gas and other commodities boosted reported pre-tax profits. However, a fall in wholesale and retail revenue left adjusted operating profits down 9 per cent at £637m. The wholesale business suffered a decline in adjusted operating profits of just under a quarter, largely as a result of a 21 per cent decrease in electricity output from renewables. On the retail side, customer account numbers fell from 8.41m to 8.13m. As a result, average household electricity supplied declined to 1,544 kilowatt hours.
The networks business - which includes gas and electricity distribution and electricity transmission - put in a better performance during the period. It reported a marginal uplift in adjusted operating profits to £456m, thanks primarily to the gas distribution business.
SSE (SSE) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,546.0p | MARKET VALUE: | £15.7bn | |
| TOUCH: | 1.545-1,546p | 12-MONTH HIGH: | 1,644p | LOW: 1,317p |
| DIVIDEND YIELD: | 5.8% | PE RATIO: | 21 | |
| NET ASSET VALUE: | 510p | NET DEBT: | 137% | |
| Half-year to 30 Sep | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 13.8 | 231 | 19.4 | 26.9 |
| 2016 | 11.3 | 616 | 47.2 | 27.4 |
| % change | -18 | +167 | +143 | +2 |
Ex-div: 19 Jan Payment: 17 Mar | ||||
