PERTH-based energy giant SSE has launched a claim likely to total tens of millions of pounds against German construction company Hochtief regarding a rockfall that halted generation at its Glendoe hydroelectric scheme near Loch Ness for three years.

The owner of Scottish Hydro-Electric revealed it had lodged a case at the Court of Session as it posted a 5.6% rise in pre-tax profit to £1.4 billion for the 12 months to March 31 – chief executive Ian Marchant's last full year in charge.

The Glendoe plant, which cost £160 million to build, was closed in August 2009, just months after its official opening by the Queen following a rockfall in the tunnel that carries water from the reservoir.

The 100 megawatt scheme only restarted operations in August 2012.

SSE, formerly Scottish and Southern Energy, told investors: "SSE is continuing to pursue its legal and insurance options.

"In particular, it has lodged at the Court of Session notification of its intention to call a comprehensive action against Hochtief Solutions AG and Hochtief (UK) Construction Limited in respect of all losses resulting from the tunnel collapse at Glendoe in 2009."

Mr Marchant said that rebuilding the plant before launching legal action ensured that the process was quick, noting that a similar problem in Austria had led to generation being lost for seven years.

"We are launching a legal action because we think we have a chance of recovering lost profit," he added.

He said SSE is now monitoring conditions at the plant, which he plans to visit before quitting the company in June, but no signs of problems have been detected.

"We have now an operating asset, a contributing asset," he added.

Despite this, hydroelectric generation at SSE fell 33% last year due to lower rainfall, hitting profits in its wholesale arm.

Its retail business was boosted by seeing colder weather in 11 of the 12 months of its financial year than in the previous year. Gas consumption was up 21% while electricity rose 5%.

SSE upped its full-year dividend by 5.1% to 84.2p.

SSE blamed costs including wholesale energy price rises for an increase in tariffs in October.

But Mr Marchant warned that further price rises could be avoided only if wholesale prices fall.

"Our short-term objective is to resist the cost pressures as long as we can," he said.

SSE said it had cut executive bonuses by 40% due to a £10.5m fine for mis-selling.

Mr Marchant, who receives a basic salary of £892,000, also revealed he will contribute the £329,000 annual bonus he was awarded for last year to a training fund for SSE staff.

In March he opted out of the company's 2012 executive incentive plan that could have netted him £583,000 to ensure a "cleaner break" from the company he has run since 2002. The 51 year-old will leave with a £10.4m pension pot that will give him an annual income of £420,000 a year from the age of 60. He also has some 377,840 shares worth nearly £6.3m.

But he criticised trends in top pay.

"We have become more American in our rewards. I am not sure that executive rewards have kept proper balance with the economy."