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Profits rise for major UK energy supplier

SSE says they are dealing with exceptional challenges.

Profits have risen 2 per cent at SSE, one of the UK's biggest energy suppliers. Growth in the power division offset a fall in the retail division.

It took a pre-tax profit of £1.3bn despite challenging economic circumstances and upheaval in the global energy market. These figures were adjusted to take account of exceptional circumstances to reflect the underlying performance of the business.

Operating profit at the Perth-based company's wholesale business unit was up 6.4 per cent to £607.9m. This includes the production, storage and generation of energy, and was boosted by a higher output of renewable energy.

However, operating profit in the retail division, fell 20 per cent to £321.6m. The retail division  supplies electricity and gas to households and businesses. Without the profit adjustment, pre-tax profits fell from £2.1bn to £268.5m.

Chairman Lord Smith of Kelvin said

Higher wholesale gas prices, falling demand for energy and a succession of winter storms presented major challenges for the wholesale, retail and networks parts of SSE. Despite this, SSE has again delivered increases in the full-year dividend and in adjusted profit before tax

SSE raised energy prices in September 2011, raising gas by 18 per cent and electricity by 11 per cent before cutting gas prices again by 4 per cent in March this year.

In a statement, SSE said that the economic outlook for Britain remains uncertain.