Centrica announces job losses

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Centrica is in the middle of shifting its focus from resources to a customer-facing business

The energy supplier's group profits decreased by 17 per cent to £1.25 billion. This included the loss of 1.4 million energy supply accounts, corresponding to 750,000 customers.

Iain Conn, Centrica's Chief Executive, said plans for a price cap in the United Kingdom was one reason for the job losses.

"These still large profits indicate that the company's strategy is weighed towards dividends for shareholders at the expense of workers' jobs".

The total number of customer accounts at Centrica's United Kingdom home division, where it managed a 1 per cent rise to £819m, slumped by 6 per cent to around 20.3 million, while its United Kingdom business unit saw a 9 per cent drop to 653,000. The profit margin per customer, which has ranged between £42 and £65 since 2009, remained broadly level at £59 - or around 6 per cent.

That's staggering even by recent standards of big six energy supplier losses over the past year.

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Centrica has previously announced thousands of jobs losses as part of a drive to cut annual operating costs by £750 million between 2015 and 2020.

The firm has expanded its total cost savings target to £500mn (US$693.7mn), which it aims to cut by 2020.

AJ Bell investment director Russ Mould said: "Investors were expecting a very poor 2017 performance from Centrica and that is what they got".

In addition, there have been concerns over losing customers to digital services.

It blamed a number of factors for the move - including pointing the finger at the government's energy price cap.

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The majority of the 4,000 jobs lost will be in the United Kingdom, where 30,000 of its 35,000-strong global workforce are based.

"We regret this deeply, and I am determined to restore shareholder value and confidence", said Iain Conn. But we're a business.

Energy firms like Centrica have been facing pressure over the way they treat customers in the United Kingdom, with controversy over pricing and the use of standard variable tariffs (SVTs) which have been deemed poor value for consumers.

Centrica said political meddling in the United Kingdom energy market had impacted its performance.

Mr Conn said he fundamentally disagreed with plans to cap prices, arguing it would reduce choice.

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