Energy switching helps power up flagging Moneysupermarket sales
The company has faced challenges as banks offer customers fewer good credit card and mortgage deals.
Moneysupermarket found comfort in its energy division in the last three months as fears that Ofgem’s new price cap would make customers less likely to change energy supplier, proved false.
The company said that revenue from its home services division, which is mainly includes energy, rose 21% compared to the same period last year, to £17.7 million.
Alongside volatility in its insurance segment, which represents nearly half of all sales, the energy boom helped lead to an overall revenue rise of 4% to £100.9 million.
There are still big savings to be made by customers even though the price cap is lower Mark Lewis, chief executive
Meanwhile, its money division “underperformed due to continuing challenges in product availability”, the firm said.
Banks and other financial services have not offered significantly better deals via the site, meaning fewer people switch to a different product.
Revenue in the money segment dropped 5% to £20.6 million, while insurance rose 3% to £49.9 million.
Ofgem’s introduction in January of an upper limit on energy prices for customers on default tariffs sparked fears that the number of customers changing to a better deal, a key part of Moneysupermarket’s revenues, would drop.
However the latest available figures, from August, show that switching is actually on the rise.
The price cap rose three months after being introduced, but fell again earlier in October.
“The group continued to grow in the quarter, with strong trading in energy showing that there are still big savings to be made by customers even though the price cap is lower,” chief executive Mark Lewis said.
“Even better, our reinvent strategy continues to do more for our customers – the new Moneysupermarket Energy Monitor service means our customers need never overpay for energy ever again.”
Energy UK said last month that so far this year 4.2 million customers have changed their energy supplier, up 11% on 2018.
Moneysupermarket said it expects its money segment to weaken further by the end of the year, but is still on track to meet market expectations.
Shares fell almost 11% to 345.2p on Thursday morning.