Centrica finds relief in cold start to the year
LONDON (Reuters) - Centrica , Britain's largest energy supplier, said on Monday its business was performing in line with guidance after a rise in energy consumption, giving the gas and power utility some relief after it cut its dividend and dampened its 2015 outlook earlier this year.
The utility's supply business benefited from colder than average weather in Britain and North America over the first quarter that resulted in customers using more energy to stay warm.
The company, which owns British Gas and has much to prove after a major management reshuffle and the start of a strategic review, said it expected a rise in downstream profits to be more than offset by the impact of lower commodity prices.
Shares in Centrica were trading 0.1 percent down at 264 pence by 0740 GMT on Monday.
Utilities across Europe have been hit by weak energy markets that have made their power plants unprofitable, reduced their upstream margins and eaten into their retail earnings.
In February Centrica cut its dividend by 21 percent and warned that future payouts would be 30 percent lower after the business was hit more strongly than expected by weak energy prices and low demand.
Centrica said on Monday its gas-fired power plants were continuing to produce less electricity than in previous years, as they remain expensive to run. This has resulted in the decision to reduce the maximum output from its South Humber gas plant until March 2017, the company said, on top of closing down its Killingholme station.
The firm had already announced a 25 and 40 percent reduction in exploration and production spending in 2015 and 2016, respectively, and said on Monday the unit was on track to make savings of 100 million pounds ($152 million) by 2016.
Chief Executive Iain Conn, the ex-BP man who took over from long-serving Centrica leader Sam Laidlaw in January, also said in a statement the company was investing millions of pounds to improve customer service at supply unit British Gas.
(Reporting by Karolin Schaps; Editing by Jason Neely, Greg Mahlich)
