Notification of close period

SSE plc will enter its close period on 31 March 2016, prior to the publication on Wednesday 18 May of its financial results for the year to 31 March 2016. In advance of these results SSE is providing information on its financial outlook, operational and investment activities.


SSE expects that it will deliver for 2015/16:  

  • an increase in the full-year dividend that is at least equal to RPI inflation1, currently expected to be around 1%; and

  • adjusted earnings per share1 of between 117 and 119 pence.  

As stated in its interim results statement in November 2015 and Q3 Trading Statement in January 2016, in view of the wider energy sector conditions, SSE continues to recognise that adjusted earnings per share1 is subject to significant uncertainties. This means that its dividend cover, based on dividend increases that at least keep pace with RPI inflation, could range from around 1.2 times to around 1.4 times over the three years to 2017/18. 

SSE expects that its adjusted net debt and hybrid capital will be around £8.5bn at 31 March 2016, compared to £7.9bn at 30 September 2015, following the acquisition and resulting investment in new gas production and plant assets acquired in October 2015, and unfavourable movements in foreign exchange rates. 

Gregor Alexander, Finance Director of SSE, said: 

“SSE continues to fulfil its core purpose of providing the energy people need in a reliable and sustainable way. Its focus is on operational efficiency, disciplined investment and maintaining a balanced range of businesses. This statement confirms the expectation that SSE will meet its financial objective with an increase in the full-year dividend that is at least equal to RPI inflation and adjusted earnings per share of between 117 and 119 pence. 

"The operating environment remains challenging, due to factors including falling commodity prices and increased retail market competition, and the Competition and Markets Authority’s Provisional Decision on Remedies represents a substantial and in places challenging package. Nevertheless, completion of the CMA investigation and the UK government’s consultation on the future of the electricity Capacity Market imply progress towards a more settled regulatory and policy framework within GB. This suggests a more encouraging environment in which to head into the new financial year, and SSE will continue to be focused on delivering for both its customers and shareholders.” 


SSE expects to report that all three of its segments – Wholesale, Networks and Retail - have been profitable during 2015/16: 

  • Wholesale operating profit is expected to be broadly in line with last year with an increase in output of electricity from renewable sources offset by a reduction in Gas Production profits to around breakeven, reflecting the challenging market conditions; 

  • Networks operating profit is expected to increase slightly, with continued growth in Transmission as a result of the delivery of a major programme of capital investment offset by the expected reduction in base revenues under the first year of the RIIO ED1 Price Control and a slight reduction in SGN profits; and 

  • Retail operating profit is expected to show a decrease mainly due to a reduction in Energy Supply customer numbers and lower Enterprise profits. 



  • announced, on 14 March, the sale of 49.9% of the Clyde onshore wind farm to Greencoat UK Wind plc and GMPF & LPFA Infrastructure LLP for £355m as part of its asset disposal programme that has, to date, delivered proceeds and debt reduction in excess of £1bn; and 

  • continued its consultation and discussions with employees and other stakeholders about the future of three of the four units at Fiddler’s Ferry Power Station, Cheshire, which are not yet complete and are expected to conclude shortly. 



  • noted the Provisional Decision on Remedies announced by the CMA following its investigation into the GB energy market, and begun preparing a response which is due by 7 April 2016;
  • welcomed the UK Government’s March 2016 consultation on reforms to the electricity generation Capacity Market, and begun preparing a response which is due by 1 April 2016;
  • completed a private placement of senior notes with 19 US and UK based investors for a total consideration of c. GBP 500m in 7, 10 and 11 year maturities; 

  • noted that, as part of their review of European Utilities, both Moody’s and S&P reaffirmed its credit rating as A3/A- negative outlook respectively; 

  • received first gas from its recently acquired West of Shetland upstream gas assets; 

  • recognised that the significant uncertainties referred to in its Q3 Trading Statement and lack of any related positive policy developments, mean its Stronelairg and Strathy South onshore wind farm developments are unlikely to qualify for the Renewables Obligation grace periods; and 

  • continued to make progress, with its equity partners, towards Financial Close on the Beatrice Offshore Wind Farm2 which is expected in April 2016. The project is progressing in accordance with the terms of the Investment Contract awarded by the UK government in 2014. 



The forthcoming referendum on the UK’s membership of the EU is a matter for voters. The result of the EU referendum presents no immediate risk to how SSE serves its customers or to the investment that it continues to make in order to fulfil its core purpose. The level of risk may, however, increase if, following the referendum, there is a prolonged period of uncertainty about the legislative or regulatory framework that SSE operates within. 

Regardless of the outcome SSE agrees with the UK Government that collaboration with other European countries on energy matters is important for UK consumers. Energy is a ‘shared competence’ and while Member States can determine how they best use their energy resources, participation in the ‘Internal Energy Market’ has been beneficial to UK customers and assisted efforts to achieve secure, affordable and low-carbon energy. Equally, SSE recognises that it is possible for a country to participate in the Internal Energy Market while not being in the EU. 

In summary, therefore, as its Annual Report 2015 made clear, SSE already recognises political and regulatory change as one of its principal risks and prolonged uncertainty following the EU referendum would add to that risk; at the same time, SSE will not take a view on whether the UK should ‘Remain’ or ‘Leave’. 


As stated above, SSE will publish its preliminary results for 2015/16 on Wednesday 18 May 2016. Its Annual General Meeting will take place on Thursday 21 July 2016. 

RPI inflation and adjusted EPS as defined in SSE’s interim results statement on 11 November 2015 

Beatrice Offshore Wind Farm with a total capacity of up to 588MW – SSE has a 40% stake