Embattled E.ON reveals slump in customers and earnings
THE owner of energy giant E.ON has revealed earnings slumped by more than a third in the first three months of the year as it took a hit from the weak pound and falling UK customer numbers.
Its German parent group posted a 34% plunge in underlying earnings to just over £843m for the first quarter after woes in its UK business sent group sales falling by 7%.
The company – which recently hiked its energy prices in Britain – said it lost customers in the UK amid tough competition from smaller rivals, while the impact from the pound’s plunge also hit revenues.
This left sales in its customer solutions division some £422m lower at £5.5bn in the first quarter.
E.ON added that higher grid fees and buying costs for power in the UK and Germany also took its toll on first-quarter earnings.
The firm has around 4.6 million energy customers in the UK, but declined to give details on how many customers were lost in the three months to March 31.
E.ON, which employs just over 9,800 staff in the UK, increased its standard variable dual fuel prices by an average of 8.8% from April 26 as it sought to offset higher costs.
Its standard electricity prices rose by an average of 13.8% and standard gas prices lifted by an average of 3.8%.
Essen-based E.ON said it remained on track to hit earnings forecasts for the full year, as it expects the first quarter blow to be “fully offset” over the rest of 2017.
Marc Spieker, chief financial officer at E.ON, said: “Our first-quarter operating performance was in line with our expectations despite a difficult business environment.”