ScottishPower earnings suffer from weak pound and warmer weather
The energy giant saw annual retail supply earnings drop 53% to 139.1 million euros (£121.9 million).
Energy giant ScottishPower has seen UK supply earnings plunge more than 50%, sparked by the weak pound and a further exodus of customers.
ScottishPower, which is owned by Spanish group Iberdrola, booked a 53% drop in annual retail supply earnings to 139.1 million euros (£121.9 million) as customer numbers fell by 200,000 to 5.1 million.
The firm pinned the blame on higher costs hitting UK electricity margins, while its gas arm struggled in response to warmer weather in 2017.
It comes as the Big Six energy suppliers face the tough task of retaining customers amid fierce competition from smaller rivals and campaigns encouraging people to switch suppliers.
ScottishPower chief corporate officer Keith Anderson said: “As anticipated, generation and supply continued to face challenges, predominantly in light of increasing input costs, reduced demand, challenging market conditions and political uncertainty.”
The Government announced a shake-up of the energy industry last year by publishing draft legislation for an absolute cap on “rip-off” energy tariffs.
However, Business Secretary Greg Clark refused to offer a guarantee that the flagship plans would be enforced by next winter.
ScottishPower is among a number of major providers to pledge to end standard variable tariffs and move customers on to cheaper fixed-price deals.
The Business, Energy and Industrial Strategy (BEIS) Select Committee said last week that there was a “clear lack of will” on the part of the Big Six to take the steps needed to address pricing problems.
Ignacio Galan, Iberdrola and ScottishPower chairman, said the UK was at a “tipping point” when it came to energy supply.
He said: “After 25 years of encouraging people to use less electricity, now we know that the best way to tackle climate change is to use more over the next 25 years.”
Revenues at the UK supply arm tumbled 11% to 4.9 billion euros (£4.3 billion) for the year to December.
Pre-tax profits also swung to a 105.8 million euro (£93.5 million) loss, down from a 15.6 million euro (£13.8 million) profit in 2016.
The wider Iberdrola group booked a 4% rise in net profit to 2.8 billion euros (£2.5 billion) despite the Spanish business struggling.