Thursday 27 October 2016

ScottishPower sees a fall in profits this year

ScottishPower saw its earnings before interest and tax fall to £924.9 million in the first three quarters of this year.

That’s in comparison to £999.4 million during the same period last year.

Demand for both gas and electricity dropped this year – by 2.4% and 1.3% respectively. The Big Six supplier’s production share in the first nine months of 2016 stood at 4.6% compared to 6% last year.

Its generation and supply business saw an improvement due to lower net operating expenses linked to the closure of the Longannet coal-fired power station. Earnings before interest, tax, depreciation and amortisation (EBITDA) stood at £187.1 million this year – a 2.6% increase from 2015.

The retail business was however down by £17 million due to milder weather and increases in non-energy costs.

Results in its renewable arm fell by 28.6% to £156.9 million, primarily driven by the 26% reduction in output across the first half of the year. Renewable output in the third quarter was 5.9% higher on the same quarter last year.

ScottishPower Renewables is currently constructing eight new onshore wind projects on six sites across Scotland, with investment of more than £650 million.

The Big Six firm has also announced contracts worth £240 million for the rollout of smart meters to customers across the country.

At the end of the first nine months of 2016, ScottishPower had 3.2 million electricity customers and 2.1 million gas customers, remaining at similar levels to the previous year.

Its parent company Iberdrola posted a 4.2% increase in earnings to €5.73 billion (£5bn) for the first three quarters of the year.

Two of the Big Six bosses, Alistair Phillips-Davies, CEO of SSE and Gab Barbaro, Managing Director at British Gas Business, will be speaking at Energy Live 2016 next Thursday. There are limited free tickets for energy end users and university students.