SSE: Energy giant bullish over earnings but warns renewables output ‘below expectations’
London-listed energy giant SSE expects to report earnings of at least 30 pence per share in its half-year results next month, but warns that generation across its renewable assets is still flagging.
The FTSE 100 company told investors that output across its renewables portfolio remains “below expectations” – approximately 19 per cent behind expectations for the six months of trading until September.
This was chiefly driven by poor weather conditions, which has weighed down the performance of its clean energy assets, with forecasts of seven per cent shortfall in planned generation over the full-year.
It has also seen the market for fossil fuels stabilise after last year’s commodities boom, which has contributed to its gas storage division posting a second half-year loss, before later bouncing back to profits this winter when gas is withdrawn from its facilities over winter.
SSE said it has navigated the return of more stable market conditions by sustaining a wide portfolio of assets across electricity networks, renewables, and storage.
This will contribute to full-year adjusted earnings per share of at least 150 pence, which is unchanged from guidance given in May 2023.
However, with key winter months to come – SSE expects it will have to provide a further update later in the year to clarify the company’s performance.
Finance director, Gregor Alexander, told investors the company’s “primary concern” is the delivery of its £12.5bn five-year investment plan, alongside SSE’s wider ambition to spend up to £40bn on net zero projects over the next decade.
He said: “In the long-term, there remains broad support for the accelerated build-out of secure, affordable, low-carbon electricity infrastructure – both in the UK and internationally – enabling the continued creation of shareholder and societal value.”
This has driven a flurry of SSE activity in the renewables sector – including the company finalising the commissioning of Seagreen, the world’s deepest fixed bottom offshore wind farm, and installing all 103 turbines at the Viking onshore wind farm which could power half a million homes.
The company is also expecting first power on Dogger Bank – the world’s largest offshore wind farm – in the coming days, with work now under way in the complex turbine installation stage of the project.
SSE’s share price is stable following the announcement, with the company up 0.4 per cent on the London Stock Exchange in early morning trading.