Utility Provider SSE Plc Is Exploring Potential Opportunities To Sell Its Retail Arm

3 min read | April 29, 2019 11:00 PM BST | By Team Kalkine Media

SSE Plc (SSE) is an integrated energy utility. It develops, owns and operates energy and related infrastructure and services. The company generates, transmits, distributes, and supplies electricity; and produces, stores, distributes and supplies gas.

SSE produces electricity in gas- and oil-fired, renewable, coal-fired, and multi-fuel plants; and gas from gas fields in the North Sea. Its operating area of operation is categorised into segments like Wholesale, retail, Networks and others.

On April 27, 2019, some media houses reported that the company is exploring potential opportunities to sell its retail supply unit.

However, the group will update investors on May 22, 2019, on the future of its household supply business, which was valued at £1 bn by the chief of SSE Plc, Alistair Phillips-Davies.

The group has also approached TalkTalk Telecom Group, a broadband provider but despite several talks, a pact between TalkTalk telecom and SSE Plc is unlikely, as per a media house report.

On December 17, 2018, SSE and Innogy scrapped out their strategic plan to merge their household supply unit post the industry administrator announced a cap on consumer bills and left SSE Plc to seek other options for its grappling retail arm.

Institutional investors like BlackRock Institutional Trust Company, N.A., Capital Research Global Investors, Causeway Capital Management LLC and UBS Limited are the top stakeholders in the SSE Plc.

The group’s debt-to-equity ratio for FY18 stood at 1.65, however industry median debt-to-equity ratio stood at 0.49, as per Thomson Reuters.

Stock Performance – 1 Year

Daily price chart (as on April 29, 2019), before the market close. (Source: Thomson Reuters)

At the time of writing (as on April 29, 2019, at 04:33 PM GMT), shares of SSE Plc were quoting at GBX 1,149.85 and declined by 3.0 points or 0.26% against the previous day close price. In the past one-year, shares have registered a 52w high of GBX 1,449.50, and a 52w low of GBX 1,026.50 and at the current market price, as quoted in the price chart, shares were trading 21% below its 52w high price level and 12.23% above the 52w low price level.

From the simple moving average (SMA) standpoint, shares were trading below its 30-day, 60-day and 200-day simple moving average price, which is a bearish technical indicator.

On a yearly basis, shares have delivered a price return of negative 17.00%, and on a year-to-date basis, the stock was up by around 6.00%.

The outstanding market capitalisation of the group stood at £11.83 bn, which ranks it among the large-cap companies listed on the London Stock Exchange and at the current market price, stock’s dividend yield stood at 8.35%, which is considerably above the benchmark FTSE 100 index. Â


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