E.On sees jump in earnings as it claws back some of last year’s losses

Energy companies have been allowed higher profits this year to make up for their losses last year.

The energy company serves millions of customers in the UK (Chris Radburn/PA) (PA Media)

Energy company E.On saw its revenue and earnings soar in the UK as it was allowed to recoup some of its losses from last year.

The business said that revenue rose 35% to 25.9 billion euros (£22.5 billion) in the UK in the first nine months of the year.

The German energy giant said that it had benefited from improved margins when selling to businesses, and a new Ofgem allowance to recover the deficits it saw in the last quarter of 2022.

The business said that pre-tax and interest earnings (EBIT) rose 112% to 873 million euros (£760 million).

E.On is and remains the pacemaker of the European energy transition

Marc Spieker

Ofgem has this year allowed energy suppliers to recoup some of the around £4 billion in losses they made from instability in the energy market last year.

It means that profits will temporarily be artificially higher than they would otherwise be.

E.On said that the number of customer accounts it serves in the UK fell from 9.1 million to 9.0 million during the period.

The business said that it also expects big jumps in its global earnings.

“E.On is and remains the pacemaker of the European energy transition, this is why we continue to carry out our ambitious investment plan,” said finance boss Marc Spieker.

“We’ve speeded up our investments to a total of almost 4 billion euros (£3.5 billion) in the first nine months of 2023, a plus of nearly 40% compared to the prior year.”

He said that the company would aim to invest another 300 million euros (£260 million) more than it had initially planned this year.

The business said that it expects a “significant negative earnings impact” in the fourth quarter of the year as it slashes prices for electricity and gas customers.

“We also see the effects of a normalising wholesale market environment,” Mr Spieker said.

“As promised, we are passing these benefits onto our customers and are reducing prices for millions of them.”