British power firm SSE trumpets investments as profits rise 23%

© Reuters.

By Susanna Twidale

(Reuters) -British power company SSE (LON:SSE) reported a 23% jump in annual profit on Wednesday and sought to highlight plans to invest billions in Britain over the coming years amid speculation the government could be planning a windfall tax on energy firms.

Several media outlets reported on Wednesday that Britain is considering taxing companies that have benefited from high energy prices following Russia’s invasion of Ukraine, to help raise cash to support households facing soaring energy bills.

Britain's finance minister Rishi Sunak has said no option is off the table if companies are not seen to be re-investing their large profits in British projects and jobs.

SSE said it plans to invest up to 24 billion pounds ($30 billion) in British energy infrastructure this decade including in new wind and hydro electric power projects.

CEO Alistair Phillips-Davies said the windfall tax was "newspaper speculation" and as such he would not speculate on what kind of impact it could have on the company's investment plans if imposed.

" We wouldn’t have put the 24 billion investment number out there unless we were confident about it," he told journalists on a media call.

SSE reported pretax profit of 1.16 billion pounds for the year ended March 31, compared with 948.9 million pounds a year earlier.

The results were buoyed by strong performance from thermal power plants such as those using gas, after wholesale energy prices soared.

Shares in the company were up 4.8% by 1136 GMT, recovering some lost ground after they fell around 8% on Tuesday following initial reports a windfall tax could be levied on power generators.

"Today's results give us more confidence on SSE's delivery of its strategy," analysts at Bernstein said in a research note.

($1 = 0.8004 pounds)