Russ Mould, investment director at AJ Bell, said: “If the UK is to reduce its reliance on increasingly volatile global energy markets then SSE may play a role given its big investment in renewables and the electricity network.
“The good news for shareholders and the rest of us is that the company’s major spending programme is progressing to plan.
“While the pressure on earnings from variable weather conditions is a reminder of one of the main drawbacks of renewables – namely their short-term unpredictability – management’s decision to deliver a meaningful hike in the dividend is a show of confidence in the outlook as it sticks with medium-term guidance.
“SSE was among the names to see some selling yesterday on news of the new energy price cap which created fears about pressure on margins and risks around higher bad debts. However, because it exited its retail energy operations several years ago it suffered less than some of its peers.”
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