26th Sep 2019 08:55
(Alliance News) - SSE PLC on Thursday reiterated its intention to pay an 80 pence full-year dividend despite an "uncertain backdrop" and a first half profit warning.
The FTSE 100-listed firm said adjusted operating profit, which in the interim is typically 35% of the full-year total, is "likely to be around 20% this year".
SSE explained that 90% of the expected GBP115 million loss in Energy Portfolio Management will be incurred in the first half. The suspension of the Capacity Market will also affect its interim operating profit.
SSE added: "The continuing suspension of the Capacity Market means SSE is unable to recognise the outstanding Capacity Market payments that are expected to be received by SSE's Thermal and Renewable electricity generation businesses in the second half of the financial year."
The suspended payments total GBP148 million, SSE said.
The company will release its results for the six months to September 30 on November 13.
Turning to the full-year, lower than expected Distribution Use of System electricity volumes, coupled with a higher number of network faults will hurt adjusted operating profit in its electricity network unit.
Scottish & Southern Electricity Networks Distribution's operating profit is now expected to be at GBP375 million, GBP25 million lower than previous forecasts.
More positively, the output of renewable energy, at mid-September, was in line with the forecast annual total for the year, due to "recent favourable weather".
Assuming the company does receive the outstanding Capacity Market payment, full-year adjusted earnings per share are expected to be between 85 pence and 90 pence, within analysts' forecasts.
Finance Director Gregor Alexander said: "The key months of our financial year are still to come, and working to mitigate the economic, regulatory and political uncertainties arising from the Brexit process will continue to be a key priority for SSE. Despite this uncertain backdrop, we are fully committed to recommending a full-year dividend of 80p as part of our five-year dividend plan to March 2023, supported by a recovery in adjusted earnings per share for the full-year and underpinned by a commitment to strong operational performance in the interests of energy customers across the UK and Ireland."
Shares in SSE were 0.7% lower at 1,217.50p each in London on Thursday morning.
By Eric Cunha; [email protected]
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