New wind capacities lift SSE Renewables' profit in H1 of fiscal 2019/20

The Stronelairg wind farm. Image by SSE (www.sse.com)

UK utility SSE plc (LON:SSE) on Wednesday reported an adjusted after-tax profit attributable to ordinary shareholders of GBP 185.3 million (USD 237.9m/EUR 216.2m) in the first half of fiscal 2019/2020, rising 11% on the year.

The result has been adjusted to exclude the contribution of SSE Energy Services and assets of Gas Production that are held for sale. These are presented as discontinued operations as of September 30, 2019.

SSE’s adjusted operating profit from continuing operations in the six months through end-September increased to GBP 491.9 million from GBP 431.3 million. The adjusted operating profit of SSE Renewables, SSE’s renewables division, rose to GBP 149.9 million from GBP 78.4 million a year before due to the expansion of the company’s installed wind power capacity and the favourable weather conditions that boosted the electricity output. Higher capacity market payments also contributed to the increase.

The financial impact of SSE’s decision to lift the estimated useful life of its onshore windfarms from 20 to 25 years will have a positive effect on both adjusted and reported results in the fiscal year. More details about the company’s performance in the six months can be seen in the table.

Results in GBP million	H1 FY 2019/20	H1 FY 2018/19
Reported profit (loss) after tax to ordinary shareholders	(434)	(291)
Adjusted profit after tax to ordinary shareholders	185.3	166.9
Reported operating profit (loss)	347.5	(184.6)
Adjusted operating profit (loss)	491.9	431.3
- Of which from Renewables	149.9	78.4
- Of which from Thermal Energy	37.1	(7.2)
- Of which from Electricity Networks	260.9	294.3

SSE’s total renewables capacity at the end of September amounted to 3,993 MW, which includes 300 MW of pumped storage capacity. The bulk of the capacity -- 1,955 MW -- comes from onshore wind, while 579 MW is from stakes in offshore wind parks held by SSE Renewables. SSE also has over 1 GW of onshore wind projects in the development pipeline. About 700 MW of these are already permitted. It also secured more offshore wind capacity in the UK government’s Contracts for Difference auction.

(GBP 1.0 = USD 1.284/EUR 1.167)

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