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Summary
- SSE Plc’s capital expenditure and investment for 2021-22 would be around £2 billion.
- The group’s adjusted operating profit was up 1 per cent to £1,506.5 million for the year ended March 2021.
- The impact of Covid-19 on the company’s operating profit has been estimated to be £170 million.
The energy company SSE Plc (LON: SSE) expects its capital expenditure and investment to be around £2 billion in 2021-22 on low-carbon energy projects. It also said it would continue its five-year dividend plan up to March 2023 while expressing its intent to recommend a final dividend of 56.6 pence per share, making a full-year dividend of 81.0 pence per share.
The group’s adjusted operating profit was up 1 per cent to £1,506.5 million for the year ended March 2021 from £1,488.4 million a year ago, while the reported operating profit witnessed a huge surge of 185 per cent. Adjusted profit before tax was up 4 per cent to £1,064.9 million compared to £1,023.4 million a year ago.
The company said that the impact of Covid-19 on the company’s operating profit has been estimated to be £170 million and was closer to the lower end of the guided range.
Also read: 5 LSE-Listed UK Energy Stocks in Focus
It said that the capital expenditure plan worth £7.5 billion was on track. Construction at the site of the flagship SSE Renewables project was underway. This included the largest offshore wind farm at Dogger Bank, Viking, and Seagreen.
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The shares of the company ended lower by 0.52 per cent at GBX 1,542 on 26 May. The benchmark index, FTSE 100 was down by 0.04 per cent to 7,026.93.
SSE said it would not give 2021-22’s full guidance. However, it expects the impact of the pandemic to be limited to the performance of Enterprise and Business Energy and wouldn’t be separately reported.
Also read: SSE Plc to triple its renewable energy generation by 2030
Disposal of non-core assets
By the end of June 2021, it expects to complete the disposals of SSE’s non-core assets and its gas production assets by the end of the calendar year. The disposal process for all its interest in SGN is expected to commence during mid-summer 2021, and an agreement on sale is expected by the end of the calendar year.
The company made significant progress its non-core disposals programme, successfully created value for shareholders and continued to sharpen the group's focus on its low-carbon electricity core portfolio in renewables, and capital investment in the same was progressing well.
SSE’s chairman Sir John Manzoni said that with a strong balance sheet, the company expects to capitalise on the growth opportunities on its way to transition to net zero.
Manzoni said that the company’s ESG credentials would keep growing as it was committed to creating value for both society and shareholders. He said that the company was bringing down emissions, creating more than a thousand new jobs, funding green recovery, contributing to UK’s GDP, and to keep shareholders informed through their dividend plan up to 2023.
