Wednesday, 17 May 2017

SSE squeezes higher profits from household energy customers

SSE made higher profits from its gas and electricity customers in the last financial year - even before its latest increase in household tariffs.
The "big six" supplier said margins per dual fuel customer rose to 6.9% in the year to the end of March, up from 6.2% the year before.

SSE's annual results come as the energy sector comes under pressure in the run-up to the election with the Tories promising a price cap and Labour planning to nationalise part of the industry.

Its latest price hike, which increased prices for typical standard tariff customers by 6.9%, took effect at the end of April.

The group said earnings from household supply in Britain saw a "small overall increase" in the 2016/17 financial year even as it shed around 200,000 customers.

That was because despite this decline, as well as higher non-energy costs and a cut in its gas tariff, there was a fall in wholesale energy prices and higher average consumption of energy.

SSE's overall full-year pre-tax profits more than doubled from £593m to £1.78bn, with the big increase largely explained by accounting charges it took in the prior year.
Adjusted pre-tax profit - stripping out one-off items - rose by 2.1% to £1.55bn, boosted by its wholesale electricity generation and gas production business.

SSE said warned against "unintended consequences" of Government intervention in the sector, which It said was already "intensely competitive".

It said the introduction of a price cap could affect 4.76 million of its 6.76 million customer accounts.

SSE chief executive Alistair Phillips-Davies said: "We have been clear for some time that 2017/18 presents challenges, and the need to engage constructively with a new UK government as it takes forward energy policy will be a key priority for the year ahead and beyond."

Big Six rivals E.On, Centrica - owner of British Gas - and Scottish Power have spoken out against the price cap proposal, warning it could lead to higher bills for consumers and reduce competition.

SKY       News.