Utility Week

UTILITY WEEK | 3RD - 9TH AUGUST 2018 | 17 This week Scottish Power puts a poor 2017 behind it Figures show recovery from poor performance in 2017, but are still down on the same period in 2016 Figures released by Scottish Power show all its business areas were "performing in line with expectations" in the first half of 2018, according to its chief executive. Keith Anderson said "excel- lent progress" has been made on delivering wind generation, such as the 714MW East Anglia One project (sse story, right), which is expected to produce power next year. But the figures show that despite a recovery from a poor 2017 performance, the generation and supply arm is down 19 per cent from £205.9 million in the same period of 2016. Last year the company lost around 200,000 custom- ers, which was one of the reasons behind a dip in the profits of its retail arm. Earnings before interest, tax, depreciation and amortisation (Ebitda) for generation and supply in the first half of 2018 were up 306 per cent (£165.8 million) compared with the same period of 2017 (£40.8 million). In the full year 2017, Scottish Power's margin for sup- plying gas and electricity was -0.3 per cent. This year it is seeking to deliver a margin of about 4 per cent, in line with a "typical year" and other retail sectors. Meanwhile, returns for SP Energy Networks (SPEN) continue in line with expectations against "record levels of investment". Ebitda for SPEN totalled £399.9 million, up 3 per cent compared with £388.0 million in H1 2017. Ebitda for Scottish Power Renewables was £205.1 mil- lion, up 27 per cent compared with H1 2017. AJ WATER S&P revises Thames outlook to negative S&P Global Ratings has revised its outlook on Thames Water's debt from stable to negative in light of "challenging regulatory pressure and weaker credit ratios". The ratings agency stressed its rationale was based on Thames's current financial pres- sure in the "absence of improve- ment in operating performance". A spokesperson for Thames said: "While we are disap- pointed that S&P has placed our ratings on negative outlook, there has been no change in the investment grade ratings that S&P has assigned to our bonds. "We are completely focused on continuing to demonstrate the operational improvements and enhancements to our financial profile that will support our credit ratings over the long term." S&P "positively" noted Thames's reduction in dividend distribution and the long-term build-up of regulated capital value. But it said the "relatively high leverage" under which Thames operates "limits" its abil- ity to absorb any future "addi- tional weakening" in profitability. ELECTRICITY Low wind speeds hit Greencoat budget Lower-than-average wind resource in May and June hit Greencoat UK Wind's portfolio generation in the first half of the year, putting it 6 per cent below budget, at 951GW. In its half-year financial results to 30 June 2018, the group said below-budget port folio generation and above-budget power prices had contributed to cash generation in line with budget. During the period, Green- coat invested £277 million in two acquisitions. In March, the group acquired the 47.5MW Brockaghboy windfarm in Northern Ireland and in May, it exercised its option to increase its shareholding in the Clyde windfarms to 28.2 per cent. ELECTRICITY £2.5 million wind contract awarded Great Yarmouth-based 3Sun Group has been awarded a contract worth more than £2.5 million to help build a new windfarm off the coast of East Anglia. The deal will create 30 jobs to service the construction stage of East Anglia One, from the £2.5 billion windfarm's new base in Lowesto harbour. The 102-turbine windfarm is being developed by Scottish Power Renewables 45km off the coast. It is hoped it will be operational by 2020, when it will provide power for around 600,000 homes. Anderson: hailed 'excellent progress' on wind Finance & Investment Stock watch 400 300 200 100 CENTRICA SHARE PRICE, 31 JULY AM 2014 2015 2018 CENTRICA SHARE PRICE, FIVE YEAR Centrica shares fell on the morning of 31 July aer the announcement of its results for the six months to 30 June. It revealed extreme weather conditions coupled with rising wholesale energy costs had affected its profits, with adjusted operating profit falling by 4 per cent to £782 million. Centrica Business also faced losses, with adjusted operating profit down by 57 per cent, while Centrica Consumer's adjusted operating profit fell by 20 per cent. 152 150 148 146 144 08:00 10:00 12:00 pence pence 2016 2017

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