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SSE PLC on Wednesday announced plans to raise £2 billion in fresh equity to help finance a £33 billion five-year investment plan, significantly increasing its exposure to UK electricity networks. The Perth, Scotland-based electricity generator said the plan for the time frame to the financial year ending March 2030 represents a trebling of investment over the five-year period. ‘This ’transformation for growth’ investment plan is built on a once-in-a-generation opportunity to upgrade the UK electricity network and build a cleaner, more secure and more affordable energy system,’ said SSE Chief Executive Martin Pibworth. ‘The accelerated investment is underpinned by secure UK government regulatory frameworks and will unlock much-needed growth across the wider economy and support thousands of jobs over the course of the plan.’ In response, SSE shares were up 10% to 2,179.69 pence each in London on Wednesday morning. Earlier, they set a new 52-week high of 2,230.00p. SSE said it will fund the plan with £21 billion in operational cashflow generation; a £14 billion increase in adjusted net debt and hybrid capital; a £2 billion equity placing; and £2 billion targeted asset rotation, meaning disposals. Around 80%, or £27 billion of the £33 billion total, is to be invested in regulated UK electricity networks and around 20% or £6 billion in renewables. The accelerated investment will see gross regulated asset value increase at an around 25% compound annual growth rate over the period, more than trebling the size of the regulated asset base. SSE forecast 7% to 9% adjusted earnings per share compound annual growth to between 225 pence to 250p in financial 2030 with index-linked earnings before interest, tax, depreciation and amortisation expected to be 80% of earnings. In addition, SSE outlined a ‘continued commitment’ to a ‘sustainable and progressive’ dividend policy to 2030, targeting annual dividend per share growth of between 5% to 10% from 64.2p in the financial year that ended this past March. SSE said the share placing is being conducted through an accelerated bookbuild to institutional investors. In addition, SSE announced a retail offer via RetailBook. The fundraise includes a £330,000 subscription by the SSE executive management team and some directors. Also on Wednesday, SSE reported reported a 31% fall in pretax profit to £586.3 million in the six months that ended September 30 from £845.9 million a year earlier. Revenue rose 3.9% to £4.63 billion from £4.46 billion, but both cost of sales and operating costs also increased. Earnings per share fell 45% to 26.4p from 47.7p, or by 29% to 36.1p from 50.7p on an adjusted basis. SSE said adjusted EPS was in line with its expectations and consistent with typical seasonality in half year results. Adjusted operating profit fell 31% to £655.0 million from £860.2 million. Electricity Networks adjusted operating profit fell 17% to £420.0 million in the recent half year from £503.8 million a year before, and Renewables declined 18% to £275.6 million from £335.6 million. SSE declared an interim dividend of 21.4p, up from 21.2p a year ago. Looking ahead, SSE reaffirmed individual performance expectations for each business unit for the financial year to March 2026. For the following financial year to March 2027, SSE said it is ‘highly confident’ about reaching its 175p to 200p adjusted EPS guidance range. In the year that ended March 2025, SSE reported adjusted EPS of 160.9p. Full year capital expenditure is expected to increase to over £3 billion, with the net debt to Ebitda ratio expected to be within a 3.5 times to 4.0x range, before adjusting for the placing. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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