LONDON -- The shares of SSE
An 84 pence per-share payment would provide shareholders of the FTSE 100 member with a prospective yield of 6.1%. The dividend confirmation came within SSE's first-half figures, which showed adjusted profits up 42% to 333 million pounds. Lord Smith of Kelvin, SSE's chairman, said:
SSE's focus is always on full-year results, because the potential for volatility is always much greater in a half year period, but it is obviously encouraging that adjusted profit before tax in the first six months has been restored to a level around that achieved in 2010.
This does not hide the fact, however, that energy market conditions remain challenging. The prices achieved for generating electricity have been weak, and higher gas and non-energy costs unfortunately had to be reflected in the increase in household energy prices which SSE implemented last month.
Lord Smith of Kelvin confirmed that the 84 pence per-share dividend projection would mean that the current-year payout would grow by at least 2% more than RPI inflation. He reckoned subsequent annual dividends could be lifted ahead of RPI inflation, too. He also reminded shareholders that the 25 pence per-share interim dividend declared today was more than three times the interim payout declared in 1999 and more than double the 2005 interim payment.
The chairman further noted that SSE remains one of just five FTSE 100 companies to have delivered better-than-inflation dividend growth every year since 1999 while remaining in the FTSE 100 for at least 50% of that time. No wonder he said this morning that SSE's "principal financial objective is dividend growth" and that the firm's "commitment to the dividend remains the hallmark of a company that takes a disciplined and long-term approach to business here in the U.K. and in Ireland."
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