May 14, 2019 / 5:23 AM / 12 days ago

Innogy's retail woes continue as first-quarter profit drops a third

FILE PHOTO: A car drives past a fast-charging unit of Germany's first solar-powered 210kWh charging park with battery backup by German ecological power supplier Innogy SE in Duisburg, Germany, January 8, 2019. REUTERS/Wolfgang Rattay

FRANKFURT (Reuters) - German energy group Innogy, which is being broken up by parent RWE and rival E.ON, on Tuesday said operating profit fell more than a fifth in the first quarter as it continued to lose customers in Britain.

First-quarter adjusted earnings before interest and tax (EBIT) fell 22 percent to 964 million euros (836 million pounds), lower than the 976 million euro average forecast in a Reuters poll of banks and brokerages.

A mix of tough competition and regulatory intervention has made life difficult for established utilities in Britain, causing E.ON and Centrica to warn of the deteriorating market conditions a day earlier.

“In the company’s UK retail business ... the persistently poor market environment resulted in a decline in customer numbers,” Innogy said on Tuesday, keeping its 2019 outlook.

In Britain, Innogy lost 103,000 customers in the first three months. On a group level, however, the company won 14,000 customers in the period, driven by its home market Germany, where it added clients on a net basis.

A part of the breakup deal, Innogy’s renewable business will go to parent RWE while its network and retail business will be integrated by E.ON, a deal that is expected to close in the second half of the year.

(This story corrects figures in first and seconmd bullet points and penultimate paragraph)

Reporting by Christoph Steitz; Editing by Michelle Martin and David Goodman

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