SSE sees 25% drop in pre-tax profit

published 9 November 2011

Gas and electricity group SSE saw its adjusted profit before tax fall 25.4% for the half year to September.

Pre-tax profit dropped from £385.5m in 2010 to £287.4m for the same six month period this year, mainly as a result of wholesale gas prices being 40% higher than in the previous year.

The firm said it took the decision to shield household customers from rising wholesale energy prices for as long as practical before implementing a price increase on 14 September.

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Company chairman Lord Smith of Kelvin said: "There is no doubt that 2011 has been characterised by turmoil in the global energy markets, economic uncertainty across much of the world and widespread concern about the financial outlook for customers, companies and countries. This is not a straightforward time in which to do business.

"SSE's half-year results reflect the impact of a number of these issues, especially the high wholesale cost of gas which eventually necessitated the increase in household prices that unfortunately had to be made in September.

"We are expecting to report a moderate increase in adjusted profit before tax in our full-year results next May."

Despite the drop, the company increased its interim dividend by 7.1%.