Creating value for shareholders and society
Today we are publishing our Full-year Results and an update on our plans. SSE is a public listed company that seeks to work in the public interest. We have a strategic goal of creating value for shareholders and society, and a clear vision of being a leading energy provider in a low-carbon world, so I want to highlight how our plans support our ambitions.
Planned SSE Energy Services merger on track
First, we’ve confirmed our belief that the proposed merger of our SSE Energy Services business and npower remains on track for completion in the last quarter of 2018 or the first quarter of 2019.
It is right that the deal is scrutinised but we’re positive that the proposed merger in its current form will deliver benefits for customers, and for the energy market and we are working constructively with the CMA to demonstrate this.
A refocused SSE with plans to invest £6bn
A refocused SSE will feature a range of complementary businesses which, combined, create sustainable value for all our stakeholders through investment in energy assets and related infrastructure. We’ve set out new plans to invest around £6bn over the next five years in the UK and Ireland, mainly in upgrading electricity networks and in new sources of electricity generation.
This includes a new, first-of-a-kind gas-fired power station at Keadby in Lincolnshire that will be the most efficient in the UK, contributing to security of electricity supply and supporting the integration of more large-scale renewables onto the system.
New ambition to tackle carbon emissions
Our strategy will support the transition to a low-carbon future and efficient, flexible gas-fired power plant such as that planned for Keadby is part of that. SSE will also continue to invest in renewable energy, in support of a new ambition to reduce by 50% the carbon intensity of the electricity we generate by 2030. If we achieve this ambition, we’ll have cut the carbon intensity of the electricity we generate by 75% since 2006.
Creating value for shareholders
SSE’s continuing investment in modernising the electricity system and its contribution to the economy is made possible by the participation of shareholders, who have supported and are continuing to support SSE’s upgrades of its electricity networks and development of new sources of power generation.
Regular dividends are what they get in return for this investment, benefiting the hundreds of thousands of small-scale shareholders as well as supporting pension funds which provide an income for people in retirement. Today we have set out a new plan for paying dividends out to 2023. In all of this it’s worth noting that dividends are directly or indirectly subject to taxation which benefits the public purse.
Creating value for society and the economy through jobs and tax
SSE believes that sustainable business success requires value to be created for shareholders and society. Today we’ve announced that our contribution to UK Gross Domestic Productin 2017/18 was £8.6bn, taking the total for the past seven years to £65.2bn. SSE also supported 99,000 jobs across the UK. Related to this economic contribution, SSE remains the only FTSE 100 company with the independent Fair Tax Mark accreditation and it paid UK tax totalling £484.1m in 2017/18.
Drawing on key strengths to create value in a sustainable way
A refocused SSE will draw on the key strengths of financial discipline, high-quality assets, a history of partnering, specialism in large capital project management and a longstanding commitment to taking sustainable decisions and responsible actions. Above all, delivery of SSE’s strategy will be dependent on the shared talent, skills and values of its people.
Delivery of the strategy will create value. For shareholders, the value SSE creates is reflected in dividends; for society, it is reflected in economic contribution, tax, jobs, investment and infrastructure.