ScottishPower posts 28% fall in pre-tax profits

ScottishPower has announced a 28% fall in pre-tax profits in the first quarter of this year. It amounted to £347 million compared to £480 million during the same period last […]

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By Priyanka Shrestha

ScottishPower has announced a 28% fall in pre-tax profits in the first quarter of this year.

It amounted to £347 million compared to £480 million during the same period last year.

Its energy networks business saw a 6% fall in profits this year to £210 million, largely driven by the phasing of investments following the implementation of Ofgem’s RIIO-ED1 distribution investment programme from April 2015.

It sets out the amount network operators can charge for their services up to 2021.

The Big Six supplier invested £160 million in its UK Networks Business in the first quarter of this year to upgrade power lines and substations.

Profits in the UK Generation business also saw a 73% fall to £47 million, with the closure of Longannet Power Station.

The Retail business is down by £81 million “due to increases in non-energy costs, mild weather conditions and tighter margins”.

However customer accounts increased to 5.5 million – from 5.4 million in the first quarter last year.

ScottishPower Renewables saw a 7% increase in profits to £90 million, with 1,164GWh generated in the first quarter this year.

It has invested more than £168 million in renewables so far in 2017, with several major contracts placed for the East Anglia ONE offshore wind farm, which will begin full construction this year.

Keith Anderson, ScottishPower Chief Corporate Officer said: “We have seen an uplift in renewables due to stronger production and the Networks business is performing in line with expectations. We anticipated the closure of Longannet would result in a year-to-year fall in the generation business.

“Margins across the industry are tight because competition has been increasing and switching numbers remain high. We will continue to work hard to get even more customers on to products.”

Parent company Iberdrola posted a net operating profit of €1.86 billion (£1.58bn), down 8.2% compared to the same period last year.