The chief executive of SSE today insisted there were grounds for “cautious optimism” despite the power company’s profits falling by almost a fifth.
Alistair Phillips-Davies said that “some of the mist is beginning to clear around the legislative, political and regulatory environment” as the Perth-based group reported a 19.3 per cent drop in pre-tax profits to £593.3 million for the year to 31 March.
Earnings were hit by lower energy prices and “intense” competition in the market, although operating profits at SSE’s energy supply arm grew 8.2 per cent to £398.9m as an increase in commercial and industrial accounts offset a decline in household customer numbers and energy consumption.
Phillips-Davies said: “It has been another year in which SSE has delivered what it said it would. Nevertheless, the operating environment presented a number of complex issues, including the impact of prevailing commodity prices and intense retail market competition.
“The fact that some of the mist is beginning to clear around the legislative, political and regulatory environment means there are grounds for some cautious optimism for the next couple of years.”
He added: “SSE continues to invest for the future and in the year ahead plans almost £1.75 billion of investment into new energy infrastructure in the UK and Ireland and improvements in services for our customers. SSE will continue to identify opportunities for growth, whilst maintaining its financial discipline, enabling it to deliver for customers, achieve its core purpose and meet its dividend commitments.”
SSE, which said in January that it was cutting gas prices for consumers, proposed a 1.1 per cent increase in its full-year dividend to 89.4p a share and said it was targeting future shareholder payouts that “at least” keep pace with the retail prices index measure of inflation.