Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on SSE PLC. We currently have 7 research reports from 1 professional analysts.
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|02Dec16 05:37||RNS||Transaction in Own Shares|
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|30Nov16 03:38||RNS||Total Voting Rights|
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Frequency of research reports
Research reports on
Retail and wholesale weigh on the half-year results
10 Nov 16
SSE has published its half-year results which show revenues falling 18.6% yoy to £11.26bn. However, a substantial reduction in the COGS (-23.5% yoy) has boosted both the gross and operating profit to reach £636.7m (+141% yoy). Along the same lines, the net profit for the company reached £476.2m, which is a +147% yoy increase, translating into an EPS of 47.2p. However, on an adjusted basis, it is a completely different story. Adjusted operating profit decreased by 9.2% to £637.2m, with an adjusted operating profit before tax falling 13.3% due to a +5.4% rise in financial expenses. Along the same lines and added to higher hybrid coupon payments, the adjusted net profit of the group reached £344.8m, which is a 24.4% fall, with EPS reaching 34.2p, down 25.5%. The group proposed an interim dividend payment of 27.4p, which is a 1.9% yoy increase, while still maintaining its EPS FY2016/17 target of 120p.
Disposal of SGN obtains a good price, but slightly below our expectations
17 Oct 16
SSE has just signed an agreement for the disposal of a 16.7% stake in Scotia Gas Networks Limited (SGN) to a fully-owned subsidiary of the Abu Dhabi Investment Authority (ADIA) for an all-cash consideration of £621m (including debt). The transaction is expected to be completed by the end of the month. SSE will retain a 33.3% stake in SGN. SSE will set out its intentions with regard to returning value to shareholders when the half-year results are released.
Balanced operational performance, but retail customer losses continue
21 Jul 16
SSE published its trading update where electricity production fell in the first quarter by 31.4% to 1.51TWh, however, output from gas production rose 37.4% to 158 million therms as a result of the Greater Laggan Area assets coming online. Moreover, customer losses continue but have slowed down with a decrease in its customer base of 0.6% in the first quarter to 8.16 million. On the other hand, home service customer accounts partially compensated the 50k customer losses in the retail business as they increased by 16k to 416k. The capex target has been maintained at £1.75bn for 2016/17, in addition to an expected envelope of £5.5-6bn up to March 2020. The group confirms that it expects to return to growth with adjusted EPS to be at least 120p and a dividend increase of at least RPI inflation for 2016-17 and thereafter. The disposal of a stake in the gas distribution system has started with the group targeting to sell up to a 30% stake of its 50% equity stake in SGN. If completed, SSE should use the proceeds either as a return to shareholders or to boost additional investment. In addition to this, an agreement has been found to dispose of the three remaining PFI street lighting entities.
P&L results above expectations; weak cash flows and dividend. Gas distribution stake sale
18 May 16
Positive FY15-16 results for the company despite the challenging conditions as the adjusted operating profit decreased by 3% yoy to £1,824m, but this was ahead of estimates. Following the same path, adjusted profit before tax fell 3.2% yoy to £1,513m, which is 2% better than expected. Reported net profit decreased by 15.2% yoy to £460m, affected by £889.8m of impartment charges linked to the wholesale market, although on an adjusted basis net income fell 1.8% to £1,195m but beating forecasts, translating into an EPS of 119.5p which exceeded the company’s guidance of 115p, as there was less dilution. Based on this, the company proposed a dividend payment of 89.4p, a 1.1% yoy increase with a dividend cover of 1.34x; however, the proposed payment is below expectations. Moreover, net debt increased 11% yoy to £8,395m. Also, SSE is considering the divestment of up to one third of its 50% equity stake in the gas distribution business (Scotia Gas Network: SGN) in addition to the current £1bn disposal programme currently in place. The guidance for 2016/17 is for an increase in operating profit, supported by networks and wholesale as retail should have a flat performance. Furthermore, the company expects to obtain at least an EPS of 120p with dividend payment growth linked to inflation and capex of around £1.75bn.
Weak operating results, but guidance maintained
28 Jan 16
The group has published a trading statement with rather weak operational results: electricity output decreased by 12% yoy on gas-fired power and 27% yoy on the coal assets. Gas production decreased by 2% yoy. The group lost 3.5% of its customers in electricity and gas to 8.28m, but increased by 14% its customer service accounts (390k). Household electricity consumption decreased by 3% and gas consumption remained flat. The number of customer interruptions decreased by 7%, which is a positive for networks. Despite this, SSE confirmed adjusted EPS at 115p and the dividend payment for 2015/16 with an increase at least linked to inflation and a similar policy for next year's dividend payment (growth at least in line with inflation). The group has announced that it will cut household gas prices by 5.3% starting from March 2016.
Increased operating costs push profits down
12 Nov 15
Mixed set of results for the group for the half year mark with revenues increasing by 11.5% to £13.83bn, although increasing costs (+13% ytd) have decreased the operating profit of the group by 24.4% to £263m, pushing downwards the net income of the group to a 23.5% fall to £192m, despite lower interest expenses. Hence, EPS reached 19.4p per share, which is 27.8% below the interim dividend proposed, which itself has been increased by 1.1% to 26.9p per share. The net debt of the group has increased more than expected to £4.98bn (an 8.7% ytd increase) without hybrid bonds, although adjusted with hybrids it rises up to £7.96bn. The increase is driven by an increase in capital investment to £757m, mostly attributed to networks (53%), increasing the regulated asset value. Concerning guidance, it has been stated that last year the group earned a quarter of its full-year operating profits in the first half, while this would correspond to 1/3rd for the current 2015-16 year, which is in line with our expectations.
Panmure Morning Note 30-11-2016
30 Nov 16
RPC, the international plastics products design and engineering group, has delivered yet another strong set of results (1H17 EBITDA +65%, EPS +45%). At the interim stage PBT was +66% (materially better than we had forecast). Topline growth has principally being driven by acquisitions (GCS + BPI), though organic remains a feature (and crucially remains at levels consistent with FY16). The two recent acquisitions have quickly been assimilated into the panEuropean platform and management has raised cost synergy guidance (again).
N+1 Singer - Morning Song 30-11-2016
30 Nov 16
Sanderson has delivered full year results in line with expectations and the 19 October trading update after a strong finish to the year compensated for a slower start. A healthy level of pre-contracted recurring revenue (50%), incremental sales to existing customers and new customer wins at higher average order values helped deliver solid revenue growth in both the Digital Retail (+9%) and Enterprise (+12%) divisions. A decent order book and good sales momentum suggest that the company is on track to deliver on unchanged profit expectations for the current year. We continue to view the valuation (FY17 EV/EBITDA 8.6x) as undemanding given an attractive combination of accelerating growth potential, strong cash generation and growing dividends.
Panmure Morning Note 02-12-16
02 Dec 16
Today James Halstead will be holding its 101st AGM. Trading during the first part of FY17 has been mixed, with some notable challenges. However, movements in FX (i.e. weak sterling) is boosting reported earnings, offsetting UK volume trends and pricing pressures. Whilst earnings are likely to be second half weighted, the picture is in-line with expectations and we are leaving our FY17 PBT estimates unchanged (£47.4m in FY17 vs £45.4m FY16).
02 Dec 16
On 30 September 2016, when the company announced its full year results, it reported that the UK business had seen a slow start to the year, with particular weakness in repair and renewal spending by the NHS as well as “reticence” in the education sector. However, with the UK only representing about a third of the business, this weakness was expected to be more than offset by the positive effect of a weakened sterling on its overseas business, given the benefits for competitiveness and margins.
Small Cap Breakfast
29 Nov 16
Asia Pacific Investment Partner - the research-driven emerging and frontier markets real estate development business intends to float on AIM and conduct a placing in December RM Secured Direct Lending - The secured direct lending fund intends to float on the Main Market on 15 December raising up to £100m Diversified Oil & Gas— Schedule One now out. $60m to be raised. Expected admission 6 December. Creo Medical Group —UK based medical device company focused on surgical endoscopy, a recent development in minimally invasive surgery. Admission due 7 December. Fundraising details TBA.