Centrica shares struggle in wake of disappointing results

FTSE 100 energy services firm Centrica (LON:CNA) watched its shares plunge by 17.62% to 69.84p (as of 12:40 GMT) after it booked a statutory loss for the year ended 31st December. Adjusted revenues dropped by 2%, but adjusted operating profits were down by 35% as margins also fell.

Chief executive Iain Conn commented: “2019 operating profit and earnings were materially impacted by a challenging environment, most significantly the implementation of the UK default tariff cap and falling natural gas prices. Against this backdrop Centrica delivered growth in customer accounts, higher net promoter scores, significant cost efficiencies in excess of our target, and full year adjusted operating cash flow and net debt within its target ranges. As expected, performance during the second half was much improved compared to the first half, demonstrating momentum as we enter 2020.

“Looking to 2020, we expect to deliver earnings momentum relative to 2019 from our core customer divisions, but Upstream earnings are likely to be impacted by the lower commodity price environment. However, with our continued focus on financial discipline we expect 2020 sources and uses of cash flow to remain broadly balanced.

“2020 will be another busy year as we complete the re-positioning of the company towards the customer, focused on our strengths of energy supply and its optimisation, and on services and solutions centred around energy, with an emphasis on helping our customers transition to a lower carbon future“.