Warm front sends a cold chill through results at Scottish Gas owner Centrica

● But energy giant assures it will achieve its 2019 cash flow and net debt targets

Scottish Gas owner Cent rica has warned th a tu nusually warm weather and a £70 million hit from the energy price cap will impact firsthalf results as it also suffered a further customer exodus.

Britain’ s biggest energy provider said it saw a“challenging” start to 2019, with falling UK natural gas prices adding to the woes, which will knock its interim performance and put “some further pressure” on its full-year outlook. It also said it lost a further 234,000 UK household customer accounts over the first four months of the year, with the announced increase in the level of the new default tariff price cap leading to a spike in customers switching in March and April.

The group said the four months to April were impacted by a £70 million financial blow from Of gem’ s cap on the standard variable tariff in the first quarter, which was compounded by the warmer-than-expected weather and lower UK gas prices.

But gross revenues rose 54 per cent in the four months and it kept its full-year outlook unchanged for operating cash flow and debt as it expects cost savings to ramp up in the final six months of 2019.

The group made savings of £58m to the end of April and is on track for £250 mover the full-year, including moves to axe up to 2,000 jobs in 2019.

Iain Conn, group chief executive, said: “Although operational performance has been largely in line with our plans, external factors have presented challenges for Cent rica during the first four months of 2019, in the form of the default tariff cap, warm weather, and falling gas prices.

“We have also experienced extensions to nuclear outages.

“However, we continue to focus on things we can control and we expect to achieve our 2019 cash flow and net debt targets, while making further progress on cost efficiency deliver y and demonstrating margin capture capability.”

John Moore, senior investment manager at wealth manager and stockbroker Brewin Dolphin, said: “While operational performance has largely been in line with expectations, these mixed results will do little to assuage investors’ concerns about Centrica.

“Customers continue to leave its home energy supply business in their droves: British Gas lost another 234,000 accounts according to its up date, adding to the more than 740,000 that went in 2018.

“As expected, warmer weather, falling gas prices, and extended outages at its nuclear power stations have had an impact on Centrica’s profitability.”