British Gas Loses 100,000 Customers Since The Start Of 2018

Posted by on Jun 19, 2018 in Gas | Comments Off on British Gas Loses 100,000 Customers Since The Start Of 2018

British Gas Loses 100,000 Customers Since The Start Of 2018

British Gas’s parent company, Centrica, has recently revealed some distressing data on the boiler repairs company. According to the company, UK’s largest energy provider, says that their subsidiary has dropped 100,000 customer accounts since the start of 2018. Centrica was warned that the looming increases in prices will lead to people switching over to rival firms.

This large number, however, is already a slowdown, as during the time frame of July 2017 to October of the same year, 823,000 customers dropped their accounts, compared to the first four months, which saw a loss of 111,000 accounts.

However, Jefferies bank has said that more losses are expected by the end of May, as the current figures doesn’t reflect the recent above-inflation price rise by the business, which only took effect at the end of the month.

Britain has been experiencing colder than usual weather, which has driven up demand for energy, but has also driven up call-out costs for boiler repairs, resulting in mixed results for the company. British Gas had the busiest week during the cold snap in February and March, leading to service plan costs that will likely cause a decrease in profits for the first half of 2018 at the company’s services unit, in comparison to 2017.

Centrica itself has taken some hits recently, with its Morecambe Bay gasfield suffering outages. On top of that, its 20% stake in the UK’s nuclear power fleet is expected to take some damage, thanks to a crack in a reactor resulting in it getting taken down. That being said, Centrica says that it that it would hit its set targets for 2018.

Iain Conn, Centrica’s CEO, says that government’s price cap on standard variable tariffs (SVTs) would have a big impact on British Gas, but they aren’t too sure how big it would be, but the company says that they’ll be in place at the end of the year.

British Gas has 3.7 million customers on SVTs, a drop from the 4.3 million at 2017’s end, with more cuts expected, to about 3 million by the time the tariffs are capped, which would reduce British Gas’s exposure.

Conn admits that 2017 has been challenging for Centrica, but defended that the progress they’ve made on cost-cutting and improving the balance sheet shows that they’re still on track. He says that they understand that people, their investors in particular, are frustrated, but they’re working on it.

Read More