SSE 'creating long-term societal value' as power giant's profits surge amid windfall demands

The boss of SSE has insisted that the Scottish energy giant is “creating future long-term societal value” after revealing a surge in first-half profits.

Posting results for the six months to the end of September, the Perth-headquartered group said adjusted pre-tax profit had risen to £559.4 million from £174.2m a year earlier. Adjusted operating profit almost doubled to £716m. The results were released a day before an Autumn Statement that could herald windfall taxes on energy generators.

SSE was buoyed by strong performances from its thermal power plants amid high energy prices. However, its renewable output for the six-month period was impacted by unfavourable weather conditions.

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Chief executive Alistair Phillips-Davies said: “One year on and despite unprecedented volatility in the operating environment, our net zero acceleration programme has never been more relevant to society. We are investing around £12.5 billion in the five years to March 2026, with further opportunities that could take the total to over £25bn this decade in the UK and Ireland alone. This direct investment primarily in offshore wind, UK electricity networks and flexible thermal will create the technologies to support long-term energy security.

“The strength and optionality of our resilient mix of market-based and regulated businesses have shone through in this period, with recent trading conditions highlighting the true value to society of a portfolio that balances intermittent renewables with flexible generation when the system needs it most. Our business model and strategy are delivering for our stakeholders today, whilst creating future long-term societal value.”

He added: “In terms of levies, caps, windfall taxes, whatever that may be, if they’re fair and reasonable - fine. We’ve got one of the best green investment markets in the world. We’ve created the biggest offshore wind market in the world. It’s critical that we don’t endanger that, particularly when all of that investment is going to be delivering energy throughout this decade at far, far lower costs than we're currently importing.”

The group declared an interim dividend of 29p per share, in line with its shareholder payout plan up until 2026. It continues to expect adjusted earnings per share (EPS) for the full year of at least 120p. First-half adjusted EPS came in at 41.8p, in line with pre-close guidance.

John Moore, senior investment manager at wealth firm RBC Brewin Dolphin, said: “SSE has delivered another good set of results and has further outlined its plans to invest meaningfully in the future of the UK’s energy network. Given the macro-economic and political environment, it is prudent to continue emphasising the latter and the role SSE plays in delivering clean energy transition which is very much the narrative that will take the company forward.

Perth-headquartered SSE is one the world's largest investors in on and offshore wind energy.

“The shares are more or less flat on a year ago, recovering from the recent dip caused by the threat of a windfall tax on excess profits. But, SSE has seldom been more relevant to the UK’s direction of travel, backed by a solid balance sheet, investment programme and a generous dividend for investors.”

SSE pointed to a number of first-half highlights including first power being achieved at the Seagreen offshore wind project with commercial operations now expected in summer 2023, and “significant progress” on the Dogger Bank and Viking projects.

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