SSE first half profit up 48% to £548.8m

Perth-based energy giant SSE said adjusted pretax profit rose 48.2% to £548.8 million for the six months to September 30 amid windy and wet weather that saw its renewable energy output surge.

However the company’s chief executive warned that while SSE had seen a return to a “more typical level of profit” in its wholesale and retail businesses, “market conditions continue to be challenging in domestic energy supply and we expect these profits to be lower at the end of the year.”

SSE said the profit increase followed a windy and wet summer in Scotland and Ireland “with higher renewable energy output, continued cost efficiencies across the group and an increase in business customers.”

Amid the heavy rain and wind, more than one third of SSE’s generation output came from renewables in the last six months.

The company’s wholesale business saw profits hit £159.6 million, similar to the level of 2013, after a bad performance during the same period last year.

Energy Supply, the SSE division that sells gas and electricity to households and businesses, returned to profit, driven by an increase in new business customers.

The company’s investment and capital expenditure was up 11.5% to £757.3 million.

SSE has started work on its largest-ever capital project building the Caithness to Moray transmission link and has completed the construction of its section of the Beauly to Denny transmission line.

“We’ve had a solid start to the financial year but half year profits are only half the story,” said Alistair Phillips-Davies, chief executive of SSE.

“There are many variables in energy and so they should be treated with caution – that’s why we focus on full year results.

“The last six months have seen us invest substantially in the UK’s energy infrastructure – committing one and a half times what we’ve made in profit in the first half of the year.

“We’ve upgraded our fleet of gas fired power stations, opened our new multi-fuel power plant and completed the Beauly to Denny transmission link and started work on the vital subsea link between Caithness and Moray.”