The owner of Britain’s biggest energy supplier faces a white-knuckle ride this winter to defend its dividend against further threats in the wake of a financial storm for the utility industry. Providing it can avoid any further pain, Centrica, the parent company of British Gas, will only narrowly manage to scrape together enough cash to pay its shareholders, its own financial advisers have warned. Analysts at German investment giant UBS, which is advising Centrica on the sale of its nuclear interests, warned that a takeover bid is one of the few scenarios in which shareholders might recover value from their investment after years of plummeting share prices. “Centrica has had another difficult year in 2018 and the strategy is now under pressure,” said Sam Arie, of UBS. “We do believe management can – just about – m eet its cash flow targets, but there is little room for anything else to go wrong and the risk of a [dividend] cut is rising,” the analyst said in an investor note. The energy giant laid bare the increasingly competitive market for Britain’s legacy energy suppliers in a recent trading update, which revealed that it has lost two million customers in the past two years.
Telegraph 8th Dec 2018 read more »