British Gas owner Centrica PLC (LON:CNA) is cutting 3,000 jobs this year despite returning to profit in the UK in the first quarter.
Centrica said the cuts, including about 800 in the first three months of the year, would contribute to £200mln of savings in 2016.
The reductions are part of the group’s £750mln a year cost-efficiency plan, which should result in lower like-for-like operating costs in 2016 than in 2015.
Group capital investment including small acquisitions is expected to be no more than £1bn in 2016, of which around £500mln is expected to be in exploration & production (E&P).
But the company also said UK home energy supply accounts fell 1.5% in the first quarter, which it blamed mainly on roll-off of significant long term contracts.
It also attributed it to new products planned for launch in the second quarter and the company’s third gas price reduction since the start of 2015 from March 16.
Net debt dropped to £4.4bn in the first quarter, benefiting from strong working capital management and seasonal phasing of cash flows.
Centrica also said it had made good operational progress in E&P and central power generation despite low commodity prices.
The company performed solidly in North America energy supply and services against what it said was a backdrop of an exceptionally warm winter.
It boosted household accounts in its North American residential business.
It has installed 2.25 million residential smart meters in the UK and remains on track to have fitted more than 3 million by the end of 2016.
Chief executive Iain Conn said the group was on track to achieve its targets for the year.
“We continue to make good progress in implementing our strategy, and with improving levels of customer service, good operational performance, lower costs, and the launch of new products to help customers manage their energy usage.”