Airtricity owner SSE ups earnings outlook on higher energy costs

UK energy utility SSE - which owns the SSE Airtricity brand in Ireland - expects earnings for its current financial year to be better than expected.

British energy utility SSE – which operates in Ireland as SSE Airtricity – is targeting better-than-expected annual earnings on the back of rising energy prices.

SSE has upgraded its outlook, saying it now expects to generate adjusted earnings per share of 90 pence for the 12 months to the end of March, instead of a previously expected 83 pence. It also said it intends to offer a full-year dividend of 81 pence.

SSE raised its prices in the UK last year and introduced three separate price increases in Ireland on the back of rising wholesale energy costs.

In November, at the time of its half-year results, SSE said the Airtricity division here made a €3.4m first-half loss, with customer numbers also slightly dipping year-on-year, having made a strong profit 12 months earlier.

SSE said its improved group earnings outlook “reflects the strength and stability provided by SSE's balanced mix of regulated and market-facing businesses, including good financial performance from flexible thermal and hydro plant which is more than offsetting lower-than-planned renewables output.” 

Renewables output in the first nine months was 19% below plan, mostly owing to a dry and wind-still summer, SSE said.

Electricity output from its gas-fired power plants was down 14% year-on-year but continues to provide valuable balancing services in an increasing renewables-led system.

In November, the company announced a hike in its green investment spending plans as it turns its focus to renewable power and networks.

Meanwhile, DCC – the Irish fuel-to-healthcare conglomerate – has said third-quarter operating profit was in line with its expectations and ahead on a year-on-year basis. 

In its latest trading update, the Flogas owner said it is expecting “strong operating profit growth” for its full year to the end of March, "notwithstanding the adverse impact of currency translation and the significant increase in the wholesale cost of energy products."

A strong growth in annual profits would be the expected outcome among market analysts also. Much of DCC's earnings are now generated by its various energy-associated businesses.

- Additional reporting Reuters