Energy giant ScottishPower has nearly tripled its annual profits in its supply arm after stemming the loss of customers to smaller rivals.
The Big Six provider, owned by Spain’s Iberdrola, said it recovered from a “difficult” 2017 to see profits in its generation and supply business soar 187% to £271.8 million last year.
It held the total number of gas and electricity customers stable above 5 million, having previously been been hit by an exodus amid competition from smaller rivals and campaigns encouraging switching.
But the profits will come as a bitter blow for some after ScottishPower announced on Tuesday it will hike prices by 10% for households on its standard variable tariffs (SVTs) from April 1 – in line with the energy regulator’s higher price cap.
It was the fifth of the six major UK providers to announce SVT increases after Ofgem said the cap would rise to reflect changes in wholesale costs.
Keith Anderson, chief executive of ScottishPower, said the supply business had “improved significantly” and hailed the group’s green credentials after making the switch to fully renewable power.
Scottish Power now generates 100% of its electricity with wind power after selling the last of its gas plants to Drax Group.
Mr Anderson said: “Last year was a pivotal year for ScottishPower as we completed the landmark journey from coal and gas to 100% green power by selling our generation business.
“It’s clear our customers are backing our commitment to green energy and our investment in a cleaner healthier future as, unlike others, our overall customer numbers have remained stable in 2018,” he added.
It said it delivered a retail margin of 3% in its supply arm and invested in the operation, installing 1.2 million smart meters, launching smart electric vehicle chargers and its first electric vehicle “time of use” tariff.
The results also showed ScottishPower’s energy networks division notched up a 5% rise in underlying earnings to £813.4 million, while the renewables business saw earnings rise 33% to £457.8 million.
The wider Iberdrola group reported annual net profits above 3 billion euros (£2.6 billion) for the first time, while operating profits jumped 27.7% to 9.3 billion euros (£8.1 billion).
It predicts “mid-single digit” growth across net profit and underlying earnings in 2019.