Share Prices & Company Research


27 May 2021

SSE Earnings Rise Despite Pandemic's Impact

SSE, the British renewable power and network operator running the largest renewables portfolio across the UK and Ireland, saw its earnings rise in the past year despite feeling the effects of the COVID-19 pandemic.

Over the year, SSE grew its earnings per share by 5%, comfortably beating analysts’ expectations by US$4. Their renewables performance was the main contributor to the year-on-year growth, with profits across the division being 29% higher than 2019.

SSE has a market capitalisation of £16.17bn and is utilising its cash reserves and size to capitalise further on the push towards global climate sustainability. Alongside the company’s earnings release, the firm announced that it is set to invest £7.5bn into low-carbon projects between now and 2025. This sizeable investment, in combination with the company’s sale of its household energy supply and services division to OVO Energy in early 2020 for around £500m, shows its intention to focus on renewable power generation and distribution. One flagship project by the company is the construction of the world’s largest offshore windfarm, which will see it partner with Norwegian oil major Equinor, as both companies push towards a greener future.

The effects of the Coronavirus pandemic on SSE were valued at £170m, which mainly came from mitigation solutions to reduce exposure to falling energy demand. The company received very little support relative to many other companies, with no rates relief received or employees furloughed. Looking at the future for SSE, the company did not release any guidance for 2021/22 but has implied it still has a stable outlook in terms of pipeline and tender opportunities via offshore projects in the UK as well as internationally. Other areas for the progress of the sector which SSE aims to gain from are the opportunities in pumped storage, hydrogen energy and batteries.

Please note that investments and income arising from them can fall as well as rise in value. This communication is for information only and does not constitute a recommendation to buy or sell the shares of the investments mentioned.
SSE Earnings Rise Despite Pandemic's Impact
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