Perth-based energy company SSE PLC (LON: SSE) remained stable in the first quarter as it prepares for its AGM.
The Company noted that renewable energy output was lower than the forecast volume for the three month period but despite this, the Group said they would retain their previous outlook provided for the financial year 2019-2020 given in May 2019.
SSE also repeated their commitment to recommending a full-year dividend of 80p per share for 2019-2020, which is in line with their five-year dividend plan.
SSE comments
Company Chief Executive, Alistair Phillips-Davies, said,
“The early months of our financial year have brought some short-term challenges and some encouraging longer-term developments, but the key months of our financial year lie ahead. I am confident we will make good progress in delivering against our strategic priorities, including the five- year dividend plan out to 2023.”
“The fact the UK has become the first major economy to legislate for net zero emissions by 2050 is a key development in the fight against climate change and reinforces SSE’s strategic focus on regulated electricity networks and renewable energy, and our commitment to creating value through the low carbon transition.”
The Company’s outlook read as follows,
“The key months in SSE’s financial year are still to come, but the overall outlook provided in May 2019 in relation to adjusted operating profit across a number of SSE’s business units in 2019/20 remains unchanged. This is despite lower than expected output of renewable energy in the three months to 30 June, with the shortfall in output equivalent to less than 4% of the annual forecast total. As stated in May, the outlook for adjusted operating profit includes suspended Capacity Market payments totalling £148m. Group adjusted net finance costs and group capital and investment expenditure in 2019/20 continue to be in line with that set out in May.”
Investor notes
Following the update, the Company’s shares rallied 1.00% or 11.50p to 1,164.50p per share 18/07/19 12:10 BST. Morgan Stanley reiterated their ‘Equal Weight’ stance, while Deutsche Bank reiterated their ‘Hold’ rating on SSE stock.
Preluding the Company’s disappointing renewables performance, other updates from the renewable energy sector, there have been recent updates from; SIMEC Atlantis Energy (LON: SAE), Aquila European Renewables Income Fund (LON: AERI) PowerHouse Energy Group (LON: PHE), The Renewables Infrastructure Group Ltd (LON: TRIG) and Tekmar Group Plc (LON: TGP).
