Centrica shares galvanised by progress

Scottish Gas-owning Centrica gave the City a double dose of good news yesterday that it has stemmed the flow of domestic customers switching suppliers and hoisted its annual earnings outlook.

The energy giant’s update beforeitscloseperiodrevealed it had pegged the number of UK home energy accounts at 14.3 million since its first half.

In those earlier six months, Centrica saw almost 400,000 customers desert the group. The company responded by launching new tariffs, and freezing its standard variable rate until at least March 2017.

Shares in the group jumped 5.6 per cent to close at 231.2p, as it said it expected higher earnings per share over the full year, helped by good trading in recent months and faster than expected costcutting.

Centricanowexpectstostrip out more than £300 million in costs from the business over 2016, up from its original target to save £200m as part of a wider drive to save £750m by 2020.

Iain Conn, Centrica’s chief executive, said: “Our performance in the second half of the year has been strong and we expect to exceed our 2016 targets.”

He added that the company had made considerable progress in reshaping the business to create a “robust platform” for growth, while also performing well “in extremely difficult circumstances”.

George Salmon, equity analyst at Hargreaves Lansdown, said: “Centrica is refocusing on its significant downstream customer base and disposing of upstream assets, and this is progressing nicely.” 0 Chief executive Iain Conn hails ‘strong’ performance