Scottish and Southern Energy (SSE) has reported a two per cent rise in adjusted full-year profits, and said it will be pushing ahead with plans to expand in the UK.
The Perth-based gas and electricity provider reported adjusted pretax profit was up to £1,25bn from £1,23bn a year earlier, and increased its dividend payout for the full year to 66p, up 9.1 per cent.
Commenting on the results, chairman Lord Smith of Kelvin said: ‘At a time of financial, economic and energy market turmoil, a company’s ability to deliver profit and dividend growth has never been more important.
‘These results mean that SSE has achieved 10 successive years of increasing profits and dividend.’
Lord Smith added that the high wholesale prices for gas and electricity in the first half of the year had impacted on the group’s performance, however, he was confident that the group’s ‘no frills’ approach would overcome these difficulties in order to further expand its electricity generation portfolio.
‘In the current economic environment, SSE’s straightforward strategy – operating and investing in a balanced range of regulated and non-regulated energy businesses – has obvious benefits.
‘It supports SSE’s fundamental commitment to maintaining annual real dividend growth, with the next step being an increase of at least 4 per cent more than inflation planned for 2009-10.’
In a separate statement, SSE said that it would build two combined-cycle gas turbines (CCGT) in Abernedd, South Wales, following its acquisition of Abernedd Power from BP.
The first CCGT is expected to be operational in 2013, with the second unit expected to begin production in 2016.
SSE will also be undertaking a joint venture with Viking Energy to submit an application to build a 540MW onshore wind farm on Shetland, and has developed a proposal to construct a pumped storage facility alongside its Sloy hydroelectric power station near Loch Lomond, as part of its plans to increase its electricity assets in the UK.
Ian Marchant, chief executive of SSE, said: ‘Since we signed the partnership agreement with Viking Energy, a great deal of work has been done to design a wind farm that we believe will be one of the most efficient in the country.
‘Hydroelectric schemes which use stored water to generate electricity have an important part to play in meeting peak demand, and also in complementing the growing, but variable, amount of output from wind farms.
‘This means that developments such as Sloy that increase storage and generation capability will play a bigger part in meeting energy needs as the development of renewable energy gathers pace.’