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Centrica stands by 2019 guidance as customer losses fall

Image: Centrica.

Image: Centrica.

Centrica has stood by its full-year guidance for this year, noting that while customer account losses have been stemmed, this was offset by growth in other areas.

The firm also announced, however, that capital investment will fall some £100 million short of what was initially pledged.

In a trading update issued today, Centrica confirmed it lost some 107,000 energy supply customers between July and October 2019. Those losses were at a slower rate than in the first six months of 2019, and “significantly lower” than it was in 2018, the company said.

The utility, which owns ‘Big Six’ supplier British Gas, said that total accounts in the UK increased by 136,000 in the UK, offsetting these loses, as other divisions grew.

As such, Centrica’s full year outlook, which was adjusted in July, remains unchanged, with adjusted operating cash flow forecast to be in the £1.8-£2 billion region.

But capital investment will fall to around £800 million, some £100 million lower than initially pledged, and efficiency savings are to rise by £50 million to £300 million, raising questions as to how those savings will be realised.

Iain Conn, Centrica Group chief executive described the company's performance as “solid”.

"I am encouraged by further growth in customer accounts and the recovery of business energy supply margins in North America, while we also continue to drive material levels of efficiency and maintain capital discipline.

“Our focus remains on satisfying the changing needs of our customers, providing energy supply and its optimisation, and services and solutions to enable the transition to a lower carbon future."

The company’s overall performance bolstered the UK side, with an increase of 86,000 accounts in North America and its operations in Ireland remained stable.

Centrica has struggled in recent years, with its results released in July showing that adjusted operating profit had fallen by 49% year-on-year to £399 million, triggering a 58% cut to the interim dividend.

This followed a disastrous 2018 for the company, the results of which in February saw the company’s shares fall by more than 10% to a 20-year low of 122.85.

Following the Q2 results, Conn announced that he was stepping down at the end of the year. He had tried to change the direction of the Centrica, trying to make it more customer-focused. His successor is yet to be announced.

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