Energy Firm SSE Expects Slightly Higher Fiscal 2015 Operating Profit

By Razak Musah Baba

LONDON--SSE PLC (SSE.LN) expects group operating profit to be slightly higher than the level achieved in fiscal 2014, the U.K electricity and gas company said Thursday, adding that it plans to deliver a full-year dividend increase in line with inflation from next year.

The company, which reported an operating profit of 848.8 million pounds ($1.49 billion) during fiscal 2014 which ended in March, said it expects to report that all three of its segments--Networks, Retail and Wholesale--have been profitable during fiscal 2015.

However, market conditions have resulted in a decline in operating profit in Wholesale. By contrast, operational performance and cost efficiencies are expected to have contributed to increases in operating profit in Networks and Retail.

Profit margin--adjusted operating profit as a percentage of revenue--in household energy supply in the U.K. can vary significantly from year to year and is expected to recover to around the more typical level reported for 2012/13, the energy company said.

SSE said it aims to pay dividends and that its objective for fiscal 2016 and subsequent financial years is to deliver a full-year dividend increase of at least Retail Price Index inflation.

RPI inflation is a measure of inflation published monthly by the U.K Office for National Statistics.

Write to Razak Musah Baba at [e-mail]; Twitter: @Raztweet

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