skip to main content

Shares in Centrica slide as customers leave, energy output slips

The owner of Bord Gáis Energy and British Gas said it would still meet its 2018 group targets that were set out in February
The owner of Bord Gáis Energy and British Gas said it would still meet its 2018 group targets that were set out in February

Shares in Centrica tumbled 9% today after the UK energy supplier reported losing customers, lower nuclear power generation and a fall in output at its oil and gas division. 

The owner of Britain's largest energy supplier British Gas said it would still meet its 2018 group targets that were set out in February. 

But that failed to reassure investors and its shares fell to 131.90 pence, their lowest level since March. 

The company also owns Bord Gáis Energy here. 

Centrica's British home energy supply business, which includes British Gas, lost 372,000 customers in the four months to the end of October. 

UK's big six energy suppliers have been losing business to smaller rivals, which often offer lower prices and have lifted their market share to 30% from 1% six years ago. 

UK energy suppliers are also facing a price cap on the most commonly used tariffs from January 1, a move regulator Ofgem said would save households around £1 billion a year.

Centrica said the cap would lead to a one-off negative adjusted profit impact of about £70m in the first quarter of 2019. 

Forecast 2018 production at Centrica's exploration and production division's Spirit Energy fell to about 47.5 million barrels of oil equivalent (mmboe) from around 50 mmboe due to unplanned outages and operational issues. 

Centrica's share of full year-nuclear generation from its 20% stake in EDF's British nuclear plants was expected to be 0.2 terrawatt hours lower since the February interim results due to outages at the Hunterston B and Dungeness B power stations. 

The Hunterston unit, which can produce enough electricity to power more than 800,000 homes, has been offline since March when cracks were found in its core during a routine inspection. 

Centrica has gained 280,000 customers in its connected home division since the start of the year and said it was on track to achieve cost savings of around 200 million by the end of 2018. 

Europe's General Court ruled last week Britain must halt payments made under its capacity auction scheme aimed at avoiding electricity shortages pending a further investigation by European Union regulators. 

Centrica said it was awaiting further updates from the UK government to determine the full implications for the capacity contracts it has at nuclear, battery and gas-fired generation assets.