Direct Energy Reports Continued Improvement in Business Margins

Centrica released an interim management statement today which notes continued improvement in its Direct Energy Business C&I margins.

"In North America, Direct Energy remains on track to deliver material operating profit growth in 2015 relative to a weak result in the prior year. Total Direct Energy gas consumption in the first quarter was 1% higher than the same period last year as, like in 2014, we experienced much colder than normal weather in the first quarter. However a combination of more stable physical infrastructure, market re-design and management action meant we did not see a repeat of the additional costs incurred last year. We continue to make good progress in building our brand in North America. In March it was announced that Direct Energy was joining a range of well-known brands to launch Plenti, the first United States-based coalition loyalty programme, where consumers can earn and use reward points for purchasing a wide range of products," Centrica said

The Plenti announcement was previously reported by RetailEnergyX.com.

"Direct Energy Business is now benefiting from increased unit margins on contracts sold in prior periods, while average commercial and industrial sold unit margins again improved in the first quarter of 2015, and were higher than in the second half of 2014 for both gas and electricity," Centrica said.

"In Direct Energy Residential, the number of accounts fell by 62,000 to just under 3.2 million in the first quarter, in a competitive sales environment," Centrica said.

"We continue to make good progress in Direct Energy Services, although service contract relationships reduced by 42,000 to 855,000 as we focused acquisition and retention efforts on our highest value customer segments. Following the acquisition of Astrum Solar last year, we completed 42% more solar installations in the first quarter than Astrum completed over the same period in 2014, albeit from a low base. Astrum Solar was rebranded as Direct Energy Solar in April," Centrica said.

The rebranding of Astrum Solar as Direct Energy Solar was first reported by RetailEnergyX.com.