OREANDA-NEWS. SSE plc has today announced its preliminary results for the six months to 30 September 2015 during which adjusted profit before tax rose by 48.2% to ?548.8m. 

It said it earned around one quarter of its full-year adjusted profit before tax in the first six months of the last financial year; but that in this financial year, it is more likely to have earned over one third of its full-year adjusted profit before tax in the first six months. 

The increase follows a wet and windier summer in Scotland and Ireland with higher renewable energy output, continued cost efficiencies across the Group and an increase in business customers.

Due to the seasonable nature of energy provision SSE focuses on full year profits and manages its business on that basis. 

The company revealed investment and capital expenditure was up 11.5% to ?757.3m - one and a half times its profit for the same period. 

SSE has started work on its largest capital project ever undertaken building the Caithness to Moray transmission link and completed the construction of its section of the Beauly to Denny transmission line.  It has also upgraded two gas fired power stations at Keadby and Peterhead to increase their flexibility and has opened its first multi-fuel power station in Yorkshire with planning consent secured for a second one.

Its Wholesale business saw profits restored to ?159.6m, similar to the level in 2013, following an exceptionally low performance during the same period last year. High rainfall and wind saw over one third of SSE’s generation output coming from renewables in the last six months.

SSE’s Retail business had a strong performance with Energy Supply, the division that sells gas and electricity to households and businesses, returning to profit after stemming the operating losses reported for the same period last year.  

This was driven by an increase in new business customers in an extremely competitive environment, driving down its own costs and lower than average temperatures leading to increased gas consumption.

However SSE said in the six months to 30 September 2015 it made less than ?5 profit per duel fuel customer and overall it expects to make less profit in Energy Supply at the end of the financial year than it did in 2014-15.

In SSE’s Networks business operating profits declined by 1.5% to ?451.6m which was expected following the new price control and reduced profits from its share in Scotia Gas Networks.

Its Transmission business is the fastest growing in Europe with record investment, including completion of the Beauly-Denny transmission line and the commencement of the Caithness to Moray subsea transmission link.

Alistair Phillips-Davies, Chief Executive of SSE, said:

“We’ve had a solid start to the financial year but half year profits are only half the story.  There are many variables in energy and so they should be treated with caution – that’s why we focus on full year results.  

“The last six months have seen us invest substantially in the UK’s energy infrastructure – committing one and a half times what we’ve made in profit in the first half of the year. We’ve upgraded our fleet of gas fired power stations, opened our new multi-fuel power plant and completed the Beauly to Denny transmission link and started work on the vital subsea link between Caithness and Moray.

“We’ve seen a return to a more typical level of profit in our Wholesale and Retail businesses however market conditions continue to be challenging in domestic energy supply and we expect these profits to be lower at the end of the year.”

SSE reports in three segments, reflecting its business structure.