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UPDATE 1-Energy supplier SSE posts profit rise, says sector "challenging"
May 21, 2014 / 6:51 AM / in 4 years

UPDATE 1-Energy supplier SSE posts profit rise, says sector "challenging"

(Adds details, chairman quote)

LONDON, May 21 (Reuters) - Britain’s second-largest energy supplier SSE reported a 9.6 percent increase in 2014 full-year adjusted pretax profit, boosted by a strong performance in its electricity transmission operations.

The group, a member of Britain’s ‘Big Six’ energy suppliers which have come under fire for consistently increasing tariffs, reported profits of 1.6 billion pounds ($2.63 billion), ahead of the 1.5 billion pounds expected by an average of 17 analysts according to Thomson Reuters data.

Despite the rise, the utility said on Wednesday the issues facing the energy sector were “very challenging”. It made the bold move in March to freeze its energy tariffs until January 2016.

“Customers, investors, regulators, politicians and SSE all want the same thing: an energy market that works for customers, and is trusted and seen to do so,” Chairman Robert Smith said.

Retail operating profit at SSE was down 28.6 percent to 292 million pounds for the year to March 2014 and the firm said it had lost 370,000 customers in Britain and Ireland.

The company’s electricity transmission operating profit, however, rose by nearly half due to a major increase in investment which chairman Smith said would continue with a net investment of around 5.5 billion pounds over four years in the network.

He said shareholders would not suffer as a consequence.

“We are committed to giving investors a fair return through an annual dividend that at least keeps pace with inflation,” he said.

The energy firm said on Wednesday its full-year dividend increased by 3.0 percent to 86.7 pence per share. ($1 = 0.5935 British Pounds) (Reporting By Costas Pitas, Editing by Paul Sandle)

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