Centrica shares suffer biggest one-day fall as British Gas loses 823,000 accounts
23rd November 2017 | Residential Energy
Shares in British Gas’s owner, Centrica, have had their biggest fall in a single day after the company shed 823,000 customers in four months and warned earnings this year would be below expectations. The UK’s biggest energy supplier said it lost nearly 6% of its customer accounts between July and October, with 150,000 of those heading for the door after the company raised prices for millions in September.
The exodus leaves British Gas with 13.1m accounts, meaning it will still be the market leader even after its rival big six supplier Npower and SSE merge to create a company with 11.5m accounts.
Shares in Centrica closed down more than 15% at 138p on Thursday, one-third below the price at which they were trading before Theresa May first raised the prospect of action on energy bills in October last year. The company’s market value has reverted back to what it was 14 years ago. Centrica warned that its earnings per share for the year would be 12.5p, one-fifth below what the market had been expecting.
Its operations in the UK and US were blamed for the shortfall. Profits at the company’s North American units are expected to be down £140m for the full year, due to a one-off charge and “highly competitive market conditions.”
Tough competition in the UK means Centrica will only break even, rather than making an expected profit of £37m.
The comparison site Energy Helpline said the exodus of customers was “historic” and showed the company’s electricity price rise had not gone unnoticed by households. Even the company’s heavy focus on connected homes and devices such as smart thermostats appears to be off track. Centrica has 1.2m connected home products, which industry watchers said suggested a target of 1.5m sold by the end of the year will likely be missed.
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