SSE reports a weak Q1: ‘we expect the company to unlock further value’

July 20, 2023 09:10 AM PDT | By Invezz

SSE reports a weak Q1: ‘we expect the company to unlock further value’ — Image source: Invezz

SSE says weather weighed on its output

Shareholders were a bit concerned about the weakness in its first quarter trading update that the British energy giant said was related to weather conditions.

SSE generated 1,625 gigawatt-hours of renewable electricity in Q1. Thermal power output also declined to 3,714 GWh. In the same quarter last year, its renewable electricity and thermal power output stood at 2,129 GWh and 3,809 gigawatt-hours, respectively.

On the plus side, though, SSE said it has had a usual start to its second quarter as weather returned to normal. The London-listed firm also noted that months that are most significant to its financial performance are still ahead.

Versus their year-to-date high, SSE shares are currently down 5.0%.

SSE left its full-year guidance unchanged

Nonetheless, SSE continues to see at least 150 pence ($1.94) of adjusted per-share earnings in its current financial year versus 166 pence per share in fiscal 2023.

Note that the power generator and network operator is committed to investing about £18 billion in renewable infrastructure through 2027. According to the Goldman Sachs analysts:

We see higher power prices and thermal generation profits adding to cashflow. As the pipeline builds, we expect SSE to unlock further value, adding to growth journey ahead.

Goldman Sachs is constructive on SSE shares and sees upside in the energy stock to £24.31 – about a 35% premium on their current price.

The post SSE reports a weak Q1: ‘we expect the company to unlock further value’ appeared first on Invezz.

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