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May 14, 2018, 2:57 a.m. EDT

Centrica on track to hit full-year targets

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By Adria Calatayud

British Gas owner Centrica PLC (CNA.LN) said Monday that it is on track to hit its targets for 2018, although it warned of disruptions at its exploration and production division.

The U.K. utility company said revenue growth is expected to be weighted to the second half of the year at its connected home and distributed energy and power segments. Net consumer customer-account losses in year to date have slowed materially relative to the average of 2017, Centrica said.

However, Centrica's exploration and production division will be disrupted as full-year production from Spirit Energy is now expected to be in the lower half of the 2018 targeted range of between 50 million and 55 million barrels of oil equivalent, due to unplanned outages at its Morecambe Bay gas fields in the U.K., and production issues on non-operated fields in Norway, the company said. Nuclear volumes will be hit by an extended outage at one of the reactors at nuclear power station Hunterston B in Scotland, the company said.

In February, the company raised its cost-efficiency program target to GBP1.25 billion per year by 2020. The company said there has been progress on the delivery of cost savings and backed its targets for the year. Analysts expect Centrica to make a pretax profit of GBP1.13 billion in 2018, according to a consensus estimate provided by FactSet.

"While the outcome of regulations to impose a temporary cap on all default energy tariffs in the UK remains uncertain, we continue to participate actively in the consultation process," Chief Executive Iain Conn said. Centrica said it believes it can deliver a sustainable and attractive business in U.K. energy supply, regardless of the outcome of the legislative process.

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