SSE PUBLISHES 2019/20 HALF-YEAR FINANCIAL RESULTS
Energy firm SSE plc has called on political leaders to put renewable power front and centre of their plans to tackle climate change, as it released its Interim Results today.
Alistair Phillips-Davies, SSE Chief Executive, says the next Government should go faster and harder on offshore and onshore wind in a bid to reach the UK’s Net Zero by 2050 targets.
The most recent offshore wind auctions achieved record low prices and more projects could be built quickly to help decarbonise the UK’s power generation.
Alistair Phillips-Davies said: “The climate emergency needs action now and offshore wind has proven itself to be one of the most cost effective ways this country can decarbonise and get on the road to Net Zero.
“Coupled with lifting the moratorium on onshore, the next Government could deliver at least another 10GW of clean, green energy, before the end of its term – enough to power over seven million homes.
“SSE is committed to investing in low carbon infrastructure and the next five years are critical if the UK is to take climate action.”
In September, SSE won contracts to build the UK’s largest offshore wind farm to-date, at Doggerbank off the east coast of England. It will also build Scotland’s largest wind-farm, Seagreen, off the coast of Fife. Due to be completed in the mid 2020s, together they will support the UK in decarbonising its electricity generation of the future.
In its Interim Results statement issued this morning, SSE said adjusting operating profit was up 14% to £491.9m, excluding its SSE Energy Services and gas production assets which are held for sale.
Generally wet and windy weather since September has resulted in renewable output for the year slightly ahead of plan with SSE Renewables’ operating profit at £149.9m.
Its energy networks business, SSEN, which keeps the lights on in central southern England and the north of Scotland, saw an 11% reduction in returns to £260.9m.
In September SSE announced it was selling its retail business, SSE Energy Services to Ovo Energy. Its profits are excluded from SSE’s overall numbers as the business is held for sale. It made an adjusted operating loss of £7.4m. Gas and electricity customer accounts were at 5.6m as of 30 September 2019, representing the slowest rate of net losses in recent years.
Headline results in line with Pre-Close Statement of 26 September and exclude SSE Energy Services and Gas Production assets:
- Adjusted operating profit on continuing operations: £491.9m, up 14%
- Reported operating profit/(loss) on continuing operations: £347.5m, versus £(184.6)m last year
- Adjusted profit before tax on continuing operations: £263.4m, up 15%
- Reported profit/(loss) before tax on continuing operations: £128.9m, versus £(284.6)m last year
- Adjusted earnings per share on continuing operations: 18.0p, up 10%
- Reported earnings/(loss) per share on continuing operations: 6.2p, versus (26.4p) last year
Interim dividend in line with five-year dividend plan to 2023:
- Interim dividend: 24 pence, down 18% reflecting dividend policy outlined in May 2018
- Intention to recommend full-year dividend of 80 pence, with annual RPI growth in the three subsequent years
Investment and capital expenditure in line with plan to 2023:
- Capital and investment expenditure: £638.2m, down 19%
- Includes £446.2m invested in regulated electricity networks and renewable energy
- Full-year capital and investment expenditure still expected to be around £1.4bn
- Adjusted net debt and hybrid capital: £10.3bn
Results of discontinued operations
- At 30 September 2019, SSE Energy Services continues to be classified as held for sale and the Group’s investment in Gas Production has also been classified as held for sale. Adjusted operating losses of the discontinued operations for the six months are £22.7m; reported operating losses are £511.8m (including £489.1m of impairment charges relating to SSE Energy Services) and the adjusted loss per share of the discontinued operations is 1.6p.
Delivery against strategic priorities continuing:
- Agreement to sell SSE Energy Services to OVO Energy Limited on course for completion in early 2020, subject to the necessary regulatory approvals
- Strong, stakeholder-led RIIO T2 business plan to be submitted to Ofgem for close to £2.4bn totex investment in north of Scotland that could contribute to a Transmission RAV of around £5bn by 2026
- SSE Renewables’ development capability confirmed by securing contracts for 2.2GW (SSE share) inCfD Allocation Round
- Transition to lower carbon electricity generation confirmed by decision to close SSE’s last remaining coal-fired generation plant at Fiddler’s Ferry by March 2020.
Updated capital and investment expenditure plan to be set out by May 2020.
Read the 2019/20 Half Year Results here.