Notification of Closed Period - 28 March 2019

SSE plc’s financial year ends on 31 March 2019. Prior to the publication of its Full Year Results on Wednesday 22 May, SSE is providing the following update on trading since the publication of its Q3 Trading Statement on 8 February 2019.

Financial outlook
SSE expects that it will deliver for 2018/19:

  • A full-year dividend of 97.5 pence per share;
  • Adjusted earnings per share in the range of 64p-69p;*
  • Cash proceeds of over £1bn from value-creating asset disposals;**
  • Capital and investment expenditure totalling around £1.7bn; and
  • Net debt and hybrid capital of around £9.5bn on 31 March 2019, taking account of disposals and down from the previous estimate of £9.8bn.

* Excluding: SSE Energy Services and any accrual for £60m of income which was due October – March 19 relating to the Capacity Mechanism ‘standstill period’.

** Sale of stakes in Clyde, Stronelairg and Dunmaglass wind farms and SSE Enterprise Telecoms and of Indigo Pipelines.

For adjusted operating profit in 2018/19, compared with 2017/18, SSE expects to report:

  • Networks - a mid-single digit percentage increase;
  • Wholesale - a significant reduction reflecting the previously communicated losses incurred in EPM; the cessation of power purchase agreements; and a lower hedged price for renewable energy output; and
  • Business Energy, SSE Airtricity and Enterprise – broadly flat.

SSE’s adjusted current tax rate for 2018/19 is still forecast to be less than 1% due to the reduction in adjusted profit before tax as a result of the EPM losses.

In line with SSE’s plans for the dividend set out in May 2018, SSE still expects the dividend to be set at 80 pence per share for 2019/20.

SSE Energy Services
SSE Energy Services is expected to be profitable and cash flow positive (excluding working capital movements) in 2018/19 and 2019/20.  Within this, in FY18/19 its household Energy Supply Business is still expected to report an adjusted operating margin of 2-3% compared to 6.8% in the previous year, reflecting the introduction of the Default Tariff Cap and lower customer numbers.

Work on the future options for SSE Energy Services, set out in SSE’s Q3 Trading Statement on 8 February, is continuing, including progress on potential external collateral arrangements that may support the opportunities for a future outside the SSE Group.  Should these options not be viable, SSE would expect to retain Energy Services as a separate entity within the SSE Group.  All options are being assessed with the interests of customers, employees and shareholders being given full consideration.  SSE intends to provide an assessment of the preferred option by the end of May 2019.

Gregor Alexander, Finance Director, SSE plc, said:
“We are making encouraging progress in our core businesses of regulated energy networks and renewable energy, complemented by flexible thermal generation and business energy sales.  Our disposals and stake sell-downs have generated over £1bn in proceeds, demonstrating our ability to create value for shareholders from developing and operating world class assets.”

“This year has clearly presented significant challenges and uncertainty in the operating environment persists, but our optionality and agility mean we are well placed to deliver on the strategy we presented last year to create value for shareholders and society from developing, owning and operating energy and related infrastructure in a sustainable way, as well as delivering against our five-year dividend plan.”


Adjusted earnings per share
: the definitions SSE uses for adjusted measures are consistently applied and are explained most recently in the Alternative Performance Measure section of SSE’s Interim results statement published on 14 November 2018.