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British Gas owner Centrica soothes investor discontent as it battles to hang on to customers

The boss of Britain’s biggest energy supplier has managed to cool the simmering discontent within its shareholder base, despite an exodus of customer accounts and a battering from the "Beast from the East". 
Iain Conn, the chief executive of British Gas parent company Centrica, told shareholders ahead of the annual general meeting on Monday that British Gas took a major hit to its energy services division due to a record number of broken boilers during the spell of freezing temperatures in February and March.
He added that the supplier lost another 110,000 domestic customers this year, but said the losses were materially lower than the 823,000 hemorrhaged between July and October last year.
The year had “begun well” and that Centrica’s financial performance in the year so far “has been good”, he said, meaning the group is on track to deliver on its 2018 growth targets and its cost cutting drive, while delivering a dividend of 12p a share.
The pledge offered a glimmer of hope for shareholders whose investments shrank by 40pc last year due to a heavy customer losses and a profit warning from Centrica’s North American business.
British Gas owner Centrica soothes investor discontent as it battles to hang on to customers

Iain Conn of Centrica

Credit:
Bloomberg News
The Centrica board dodged a shareholder rebellion after blocking a ?600,000 bonus for Mr Conn in his 2017 remuneration package.
In addition, the rest of the executive team opted to forego their bonus rewards in recognition of the shareholder pain – even though many of the challenges facing the group are beyond the group’s control.
The UK energy market faces “high levels of competitive intensity” and the Government’s looming cap on standard energy tariffs which is due to come into force by the winter.
The FTSE 100 firm is also on the hunt for a new chairman after Rick Haythornthwaite announced plans to step aside last week.
Centrica remains on target to slash costs by ?200m this year, partly by cutting 1,000 jobs, in a ?1.25bn efficiency drive aimed at reviving its prospects in the face of tough competition, Mr Conn added.
The optimism lifted Centrica’s share price by 1.36pc to 149.15p on Monday. 
“Centrica is in the midst of a turnaround,” said analysts at Hargreaves Lansdown. “We can see the attractions of where it's trying to get to, but the journey's proving far from smooth.”
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