SSE cuts earnings guidance due to state aid delay

Energy utility SSE downgraded its annual earnings forecast due to a delay in receiving government support.

Adjusted earnings per share for the year through March was now expected to fall 6% to between 64p and 69p.

Previous guidance was for adjusted EPS of 70p and 75p.

SSE noted that a judgement on 15 November in the European Court of Justice had the effect of removing the European Commission's State Aid approval of the GB Capacity Market scheme.

It also saw the introduction of a 'standstill period' until the scheme could be approved again.

'The UK government continues to believe that the capacity market is the right mechanism for delivering security of supply at the lowest cost to consumers and stated in February 2019 that it intends to 'ensure that suspended payments are made to holders of capacity market agreements for 2018/19,' SSE said.

'This should make this income recognition issue a matter of timing only.'

SSE added that its actual adjusted EPS for the year would 'continue to be influenced by the range of factorsl' set out at the start of the financial year.