Markets seemed unconcerned by SSE’s annual results this morning despite the firm battling headwinds in its generation and wholesale gas business. The firm’s share price stayed broadly flat.
Adjusted profit before tax fell by 3.3% to £1,513.5m while unadjusted profit before tax fell by 19.3% to £593.3m. The firm recorded net exceptional charges of £889.8m relating to its wholesale business. Of that sum, write downs for gas generation totalled £326.4m, while coal generation charges totalled £287m.
SSE said coal generation charges reflect its announcement a year ago that Ferrybridge would cease commercial operations in March 2016 as well as increased uncertainty at Fiddler’s Ferry. The gas generation charges related to some of its gas plants (the firm cited Peterhead, Marchwood and Medway) struggling due to continued low wholesale power prices as well as concerns that they may not participate in the capacity market in the long term.
The firm also lost a further 300,000 retail customers, reflecting an increasingly competitive and price-driven domestic supply market.
However, the company made some gains within the I&C sector, adding 20,000 business accounts in the year to 31 March.
SSE, which also has a telecoms business, aims to bundle services to those customers and stated that it would continue to focus on a strategy of diversification, bundling and customer service.
See the full results here.