Belfast Telegraph

E.ON's UK sales tumble as customers move to smaller rivals

Energy giant E.ON has become the latest Big Six provider to suffer amid competition from smaller rivals after falling customer numbers sent sales in its UK residential arm tumbling 19%.

The German-owned provider said revenues in its UK customer solutions business fell to 1.72 billion euros (£1.47 billion) in the three months to the end of June from 2.12 billion euros (£1.8 billion) a year earlier.

UK revenues fell 16% overall in the first six months of 2016, to 4.36 billion euros (£3.73 billion).

E.ON blamed customer losses on the sales fall as well as its move to cut gas prices by an average of 5.1% on February 1.

Britain's biggest suppliers are being hit by falling customer numbers as households increasingly switch to smaller suppliers in search of cheaper tariffs.

British Gas lost almost 400,000 residential customers in the first six months of the year, while SSE revealed it lost another 50,000 gas and electricity accounts in the second quarter.

The latest industry figures show more than 30,000 people switched energy supplier last month - a record for July - bringing the number of switches in 2016 to over 2.5 million.

July's data from Energy UK shows 76,174 customers switched to smaller suppliers in July, which is 23% of all switches.

E.ON, which employs around 10,000 staff in the UK, said it also saw lower demand for energy in the UK due to unusually warm weather at the start of the year.

But it lifted underlying half-year earnings in its UK residential arm by a third to 291 million euros (£249 million) thanks to lower costs of government-mandated energy-efficiency measures.

Group-wide underlying earnings fell 6% to 2 billion euros (£1.7 billion), although E.ON said its core business saw a 15% rise to 1.7 billion euros (£1.5 billion).