The investment case for owning SSE shares used to be simple and straightforward: It was all about paying dividends and growing them at least in line with inflation.
This served shareholders reasonably well with total returns of 105 per cent over the last decade compared with 72.8 per cent for the FTSE All-Share index. Virtually all of that return has come from dividends as the share price over the years has not made much progress.
The dividend strategy has been cast aside. In many ways, SSE was paying an unsustainable dividend for years as volatile profits from conventional power generation and domestic energy supply saw dividend cover become very thin as virtually all the company’s profits were being paid out.