Notification of Closed Period

RNS Number : 3255J

SSE PLC

29 March 2018

 

SSE plc

NOTIFICATION OF CLOSED PERIOD

SSE plc will enter its closed period on 1 April 2018, prior to the publication on Friday 25 May of its financial results for the year to 31 March 2018. 

Financial Outlook 2017/18

SSE expects that it will deliver for 2017/18:

·     An increase in the full-year dividend that is at least equal to RPI inflation which is forecast to be around 3.7%;

·     Adjusted earnings per share that is just above 120 pence; and

·     Capital and investment expenditure totalling around £1.5bn with net debt and hybrid capital likely to be around £9.3bn at 31 March 2018.

SSE expects to report that all three of its segments - Wholesale, Networks and Retail - will have been profitable during 2017/18. 

·     Adjusted operating profit for Wholesale is expected to be significantly higher than in 2016/17, mainly reflecting the increase in electricity output from SSE's renewable and gas-fired generation plant.

·     As previously stated, adjusted operating profit for Networks is expected to be around £150m lower than in 2016/17, on an absolute basis, as a result of:

i.     the disposal by SSE in October 2016 of part of its stake in SGN;

ii.    the phasing of returns in the Price Control mechanisms for Electricity Transmission and Distribution. 

·     Adjusted operating profit for Retail is expected to be broadly in line with that earned in 2016/17. 

Financial Outlook 2018/19 and beyond

The 2018/19 financial year is expected to be one of transition for the SSE group.  The planned demerger of SSE's GB household energy supply and services business remains on course but its timing, if approved, is not certain.  Furthermore, within 2018/19, the impact and timing of the Domestic Gas and Electricity (Tariff) Cap Bill, if enacted, is unclear.

Despite these uncertainties and their potential impact on adjusted earnings per share, SSE continues to target an annual increase in the full-year dividend for 2018/19 that is at least equal to RPI inflation. 

SSE said on 8 November 2017 that following the expected demerger of its GB household energy supply and services business, its dividend and dividend policy from 2019/20 for the remaining business will reflect the quality and nature of its assets and operations, the earnings derived from them and the longer-term financial outlook.

SSE also said on 8 November 2017 that more detail on this will be set out by the time the shareholder circular in respect of the transaction is published, and this will be included in the preliminary results statement on 25 May 2018. SSE intends to supplement the preliminary results presentation on that date with updates on the business areas expected to remain within SSE after the planned demerger.

Intention to create a new independent energy supplier

Following early engagement with the Competition and Markets Authority (CMA), SSE and innogy SE formally notified the CMA on 28 February 2018 of their intention to create a new, independent energy supplier in GB.  This triggered an announcement by the CMA on 28 February 2018 that a Phase One investigation of the transaction is now under way.  This is the standard process and has a statutory deadline of 40 working days.

Work has continued to progress to prepare for the planned transaction and SSE will shortly complete the transfer of the GB energy supply and services businesses that are expected to be the subject of the planned demerger and subsequent merger with npower to a wholly-owned subsidiary named SSE Energy Services Group.  A total of 8,800 employees are being transferred to the new retail group. 

Gregor Alexander, Finance Director of SSE, said:

"As expected, 2017/18 has involved a number of significant challenges, but SSE is a robust, sustainable business that has kept its strong operational focus on meeting the needs of customers.  It has also kept its focus on efficient investment in the energy assets needed now and in the future.  This means we are in a good position to deliver financial results ahead of our expectations at the start of this financial year.

"The challenges are not expected to relent in 2018/19, and it will be a year of major transition and change for SSE.  Throughout the year, we will retain our strong operational and investment focus, while preparing the businesses in the SSE group for the important developments that lie ahead.  In this way, we will do the best possible job for customers and other stakeholders, and build options and opportunities for the future, while delivering on our dividend commitment to investors.  That has been, and will remain, the SSE way."

 

END

 

 

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