SSE cuts investment plans by £3bn as FY profits drop
Energy company SSE Plc has cut its network investment programme by £3bn amid a "complex operating environment", as it reported a sharp drop in full-year profits.
The Perth-based outfit said it was lowering its investment expectations for the five years to 31 March 2027 to around £17.5bn as a result of "financial discipline in a changing macro environment across the energy businesses and consent phasing in networks".
The £3bn reduction comprises a £1.5bn cut in renewables investment, £1bn cuts to thermal and other operations, and £0.5bn cuts in the transmission division.
"The group's investment plans have not been immune to the changing macroeconomic environment and wider delays to the planning processes which have been seen over the last 12 months," SSE said in a statement.
Around 90% of this investment plan is already committed, but the remainder is subject to delay or potentially even cancellation if the right investment conditions do not emerge, the company said.
Adjusted pre-tax profit over the 12 months to 31 March totalled £2.14bn, down from £2.20bn the year before, with adjusted earnings per share flat at 160.9p.
However, when including adjusting items like a £249.5m impairment charge against its investment in the Southern Europe Renewables pipeline - reflecting sector-wide delays to permitting and grid connections - reported pre-tax profit was down 25.8% at £1.85bn.
Despite the weaker bottom line, the company still recommended a final dividend of 43p per share, increasing the full-year payout by 7% to 64.2p.
"We are particularly well placed to contribute to future energy systems in our home markets built on renewables, networks and flexibility," said chief executive Alistair Phillips-Davies.
"This opportunity, alongside our balance sheet strength and the increased proportion of index-linked revenue we anticipate, gives us every confidence in our FY27 target of 175-200p earnings per share and sustainable growth to 2030 and beyond."
SSE's shares were up 1.1% at 1,818p by 0821 BST.
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