Business

SSE raises profit outlook as windy weather boosts production

Supplier says production from renewables rose 25% in nine months

Photograph: Matthew Lloyd/Bloomberg

Wed Jan 31 2018 - 08:39

SSE, Britain's second-biggest energy supplier, raised its full-year profit outlook on Wednesday as wet and windy weather drove a 25 per cent rise in production from its renewable energy plants in its first three quarters.

Shares in SSE rose 1.8 per cent to top the blue-chip FTSE 100 index.

The supplier said it expects to deliver adjusted earnings per share in the range of 116 to 120 pence. In November, the company had forecast that earnings would be at least in line with the consensus forecast of 116 pence.

SSE also said it expects to spend about £1.6 billion (€1.83 billion) in the full year 2017-2018, lower than its previous estimate of £1.7 billion.

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The company, however, maintained its capital expenditure estimate of about £6 billion over four-years to March 2020.

Wind energy production rose to 4 terawatt-hours (TWh) in the nine months ended December 31st, from 3 TWh in the same period last year. Hydro energy output also rose to 2.5 TWh from 2.1 TWh a year ago.

The company lost 40,000 customer accounts during the three months to end-December, compared with the 50,000 it lost in the previous quarter. It ended the latest quarter with a total of 7.68 million customers.

SSE also said its plans to merge its UK power and gas retail operations with those of npower, owned by Germany's Innogy, was on course to be completed by the last quarter of 2018 or the first quarter of 2019.

Power suppliers in Britain have been under pressure from the emergence of small and aggressive rivals as well as being threatened by a price cap on retail prices proposed by Prime Minister Theresa May’s government.

Britain's "big six" energy suppliers, Centrica's British Gas, Iberdrola's Scottish Power, E.ON, EDF Energy, SSE and npower, are all currently struggling. - Reuters

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