SSE warns on profits after long hot summer
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Shares in SSE (LON:SSE) dropped by 7.88% to 1,151.98p (as of 11:00 BST) after the energy company announced that persistently high gas prices and warm, still, and dry weather continue to put pressure on the business. This has meant that demand has been lower than expected and supply costs have been higher with lower than usual output from renewable sources.
Management said that operating profit for the first five months of the financial year came in roughly £150 million below plan and that adjusted operating profit for the six months ending 30th September will be roughly half of that from the equivalent period of 2018.
Chief Executive Alistair Phillips-Davies said: “Lower than expected output of renewable energy and higher than expected gas prices mean that SSE’s financial performance in the first five months has been disappointing and regrettable.
“The underlying quality of SSE’s businesses remains strong, with regulated networks and renewables providing the core of what will be an infrastructure-focused SSE group in the years ahead.
“This year’s £1.7bn programme of capital investment, mainly in regulated networks and renewables, has continued to go well in recent months; and we are very pleased that the CMA’s provisional findings in relation to the planned SSE Energy Services transaction means we are on course to reshape and renew the SSE group by the end of our financial year.
“Reshaping and renewing the SSE group will support the delivery of our five-year dividend plan in the years ahead“.
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