REG - SSE Plc - Strategic Update

SSEAnnouncement

12/11/2025 07:00

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RNS Number : 1470H  SSE PLC  12 November 2025

This announcement contains inside information under Article 7 of the Market Abuse Regulation (EU) No 596/2014, as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR").
SSE plc

Strategic update
Transformation for Growth - SSE's 2030 investment plan
12 November 2025

 

SSE plc today announces a transformational, fully-funded, £33bn five-year
investment plan, significantly increasing the Group's exposure to UK
electricity Networks, and driving long-term value creation with attractive
regulated asset value and earnings growth.

·      Transformational £33bn fully-funded investment plan to 2029/30
represents a trebling of investment over the five-year period, with around 80%
or £27bn to be invested in regulated UK electricity Networks and around 20%
or £6bn selectively in Renewables and system Flexibility, all delivering
attractive growth and returns.

 

·      Accelerated investment will see gross regulated asset value
('RAV') increase at a ~25% CAGR over the period, positioning SSE as one of the
fastest growing electricity networks in the world and more than trebling the
size of the regulated asset base.

 

·      Attractive 7 - 9% adjusted Earnings Per Share CAGR to between 225
- 250 pence in 2029/30 1  (#_ftn1) , with index-linked EBITDA 2  (#_ftn2)
expected to be ~80% of Group earnings in 2029/30, primarily driven by the
significant regulatory asset growth.

 

·      Continued commitment to SSE's sustainable and progressive
dividend policy to 2029/30, targeting annual dividend per share growth of
between 5 - 10% from an unaltered 64.2 pence 2024/25 baseline.

 

·      Fully-funded plan maintains SSE's strong balance sheet alongside
a continued commitment to strong investment grade credit ratings:

o  ~£33bn adjusted investment and capital expenditure, of which ~£3bn is
currently uncommitted  across the SSE Renewables and SSE Thermal businesses
and subject to strict investment criteria that ensure delivery of high returns
on capital;

o  ~£6bn of dividends, taxation and other cash requirements.

·      The plan is funded by:

o  ~55% or ~£21bn operational cashflow generation;

o  ~35% or ~£14bn increase in adjusted net debt and hybrid capital,
relatively smaller than the increase in regulatory assets, with net debt /
EBITDA remaining below 4.5x throughout the course of the plan, comfortably
within the thresholds required to maintain existing strong investment grade
credit ratings;

o  ~5% or £2bn equity placing, launched concurrently to this announcement;

o  ~5% or ~£2bn targeted asset rotation across the portfolio, aligned with
investment needs.

 

Martin Pibworth, Chief Executive, said:

"This Transformation for Growth investment plan is built on a
once-in-a-generation opportunity to upgrade the UK electricity network and
build a cleaner, more secure and more affordable energy system. The
accelerated investment is underpinned by secure UK Government regulatory
frameworks and will unlock much-needed growth across the wider economy and
support thousands of jobs over the course of the plan.

"Our world is rapidly electrifying, and we need to build, connect and
transport ever greater volumes of homegrown power to homes and businesses to
power the digital age. SSE's multi-decade-long track record of delivering
major electricity assets means it is strongly positioned to respond to this
critical infrastructure investment opportunity and, in doing so, underpin the
Group's position as one of Europe's largest electricity infrastructure
companies.

"Our focused, disciplined and fully-funded investment plan will transform the
domestic energy system and improve lives, whilst creating sustainable value
for our shareholders and society for decades to come."

Strategic direction and delivery

SSE has a clear focus on delivering the major electricity infrastructure
required for the energy transition. As an integrated electricity business, it
is primarily focused on the three key pillars required for an electrified
transition: Networks, Renewables and Flexibility.

With the UK Government's Clean Power Plan and associated strategic plans from
the National Energy System Operator, there is an extensive roadmap for
investment in SSE's core domestic markets under all electricity demand
scenarios. The UK and wider European roll-out of cleaner technologies to
upgrade energy systems, adopt electrification and accelerate AI, places
electricity networks together with clean and flexible generation at the heart
of the transition. Underpinned by secure regulatory frameworks, investment is
needed well into the 2030s and, with rising demand from an increasingly
electrified economy, potentially significantly beyond.

SSE has the highly skilled workforce, strong supply chain relationships and
access to strategic partnerships required to support significant growth. The
foundations for this plan have been laid over several years. A fivefold
increase in headcount in the Transmission business, accelerating innovation
through digitalisation and a keen focus on efficiency and competitiveness mean
that the Group has the platform, the capabilities and the resource to deliver
this once-in-a-generation investment opportunity.

The strategic investment plan announced today will enable SSE to maximise its
potential over the next five years. As SSE helps transform the UK and Irish
energy system, building out one of the fastest growing networks in the world
and some of its largest offshore wind farms, SSE will underline its position
as a strategically important top-tier European utility with prospects for
further expansion in the 2030s and beyond.

Record programme of investment

The £33bn investment plan announced today results in a significant
upweighting in regulated Network assets, combined with disciplined investments
in electricity generation technologies:

·      SSEN Transmission (~67% or ~£22bn) delivering the RIIO-T3
investment programme which is critical to connecting renewables and removing
existing constraints within the electricity transmission network. This
investment, together with that from our 25% partner, is expected to increase
gross RAV to around £30bn by the end of 2029/30 representing an ~30% CAGR.

·      SSEN Distribution (~15% or ~£5bn) delivering the remaining
RIIO-ED2 investment programme in addition to anticipated strategic investment
in ED3. This investment is expected to increase gross RAV to between £9-10bn
by the end of 2029/30 representing a ~10% CAGR.

·      SSE Renewables (~12% or ~£4bn) delivering its existing
construction programme together with highly disciplined investment into
exciting growth options. This focus on financial discipline and selective
growth is expected to result in a targeted ~9GW of installed capacity by the
end of 2029/30.

·      SSE Thermal and other businesses (~6% or ~£2bn) predominantly
focused on flexible generation technologies and serving key customers.

The above investment plan includes ~£3bn of currently uncommitted capex
across the SSE Renewables and SSE Thermal businesses. In allocating this
capital, SSE will continue to apply its strict returns criteria for new energy
projects to ensure attractive shareholder returns and strategic alignment with
SSE's clean electricity focus.

Capital growth and total returns

The record programme of investment outlined above is expected to deliver
industry-leading capital growth across the Group. In the Networks businesses,
gross RAV is expected to more than treble to around £40bn and, with selective
and disciplined investment, Renewables installed capacity is set to almost
double to around 9GW by the end of the plan. This material capital growth will
create significant long-term value for shareholders whilst unlocking wider
economic benefits for society.

Investments made in Networks and selective Renewables and system Flexibility
projects are expected to drive a step-up in earnings of around 50% over the
plan, with an adjusted Earnings Per Share CAGR of between 7 - 9% delivering
225 - 250 pence in 2029/30. This growth is underpinned by ~80% of EBITDA being
index linked in 2029/30, due to the upweighting in Networks investment,
providing consistent, predictable and highly visible earnings as the business
grows materially.

SSE is also continuing its existing sustainable and progressive dividend
policy to 2029/30. This policy targets annual dividend per share growth of
between 5 - 10% from an unaltered 64.2 pence 2024/25 baseline. SSE will retain
the existing scrip dividend option for shareholders whilst also restricting
earnings dilution from the scrip by capping take-up at 25% through a share
buyback if necessary.

The SSE plc Board believes that the comprehensive funding strategy outlined
today will provide the best outcome for shareholders, delivering an
unprecedented growth opportunity with continued commitment to existing strong
investment grade credit ratings and laying the foundations for attractive,
sustainable earnings growth and value creation well into the next decade.

Interim results statement and 2025/26 outlook

Alongside today's proposed placing announcement, SSE plc is updating the
market on its interim results for the six months ended 30 September 2025. The
statement is available on the sse.com investor pages, linked here
(https://www.sse.com/reportsandresults) ). This includes:

·      Half-year adjusted Earnings Per Share of 36.1 pence, in line with
expectations.

·      Delivered £1.6bn adjusted capital investment in the period, of
which around 70% was in regulated electricity Networks, with adjusted net debt
and hybrid capital at £11.4bn.

·      Reconfirming divisional adjusted operating profit expectations
for full-year 2025/26 and 2026/27.

·      Reconfirming 2026/27 adjusted Earnings Per Share guidance of
between 175 - 200p, before adjusting number of shares in issue for today's
proposed placing.

Management presentation

SSE will be webcasting a live strategic update together with its interim
results today at 8:00am UK time. Investors and analysts are invited to join
the webcast by visiting www.sse.com (http://www.sse.com) and following the
links on either the homepage or investor pages; or directly using this link
(https://edge.media-server.com/mmc/p/69m56nwu/) .

This webcast is also available as a teleconference, for which participants can
register using the link here
(https://register-conf.media-server.com/register/BI29d8460f14414212abeb650f1285da97)
to receive a unique pin code and conference call number. Both facilities will
be available to replay.

 Enquiries
 Investors  SSE Investor Relations  ir@sse.com (mailto:ir@sse.com)        Michael Livingston  +44 (0)345 0760 530
 Media      SSE Media               media@sse.com (mailto:media@sse.com)  Ross Easton         +44 (0)345 0760 530
            MHP                                                           Oliver Hughes       +44 (0)7885 224 532
                                                                          James McFarlane     +44 (0)7854 142 665

The person responsible for making this Announcement on behalf of the Company is Liz Tanner, Group General Counsel and Company Secretary.
Disclaimer

This announcement contains forward-looking statements about financial and
operational matters. These statements are based on the current views,
expectations, assumptions, and information of management, and are based on
information available to the management as at the date of this announcement.
Because they relate to future events and are subject to future circumstances,
these forward-looking statements are subject to unknown risks, uncertainties
and other factors which may not have been in contemplation as at the date of
the announcement. As a result, actual financial results, operational
performance, and other future developments could differ materially from those
envisaged by the forward-looking statements. Neither SSE plc nor its
affiliates assume any obligations to update any forward-looking statements.

SSE plc gives no express or implied warranty, representation, assurance or
undertaking as to the impartiality, accuracy, completeness, reasonableness or
correctness of the information, opinions or statements expressed in the
announcement or any other information (whether written or oral) supplied as
part of it. Neither SSE plc, its affiliates nor its officers, employees or
agents will accept any responsibility or liability of any kind for any damage
or loss arising from any use of this announcement or its contents. All and any
such responsibility and liability is expressly disclaimed. In particular, but
without prejudice to the generality of the foregoing, no representation,
warranty, assurance or undertaking is given as to the achievement or
reasonableness of any future projections, forward-looking statements about
financial and operational matters, or management estimates contained in the
announcement.

This announcement does not constitute an offer or invitation to underwrite,
subscribe for, or otherwise acquire or dispose of any SSE plc shares or other
securities, or of any of the businesses or assets described in the
announcement, and the information contained herein cannot be relied upon as a
guide to future performance.

 1  (#_ftnref1) From an unaltered 2024/25 baseline of 160.9 pence. 2029/30
guidance presented after adjusting number of shares in issue for today's
proposed placing

 2  (#_ftnref2) Being Adjusted EBITDA which is underpinned by an index linked
revenue stream - such as regulatory networks, renewables' contracts for
difference or flexibility capacity market income - providing consistent,
predictable and highly visible earnings.

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