Ovo Energy makes first profit as smart meter push pays off

Jessica Morris
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Ovo is one of a group of energy market challengers (Source: Getty)

Independent energy supplier Ovo made a pre-tax profit for the first time in its seven-year history, helped by improved customer tenure and as "being a first mover with smart meters paid off".

The company said today that its pre-tax profit hit £30.4m in the six months to 30 June, up from a loss of £3.6m a year earlier.

This came after its pre-tax loss narrowed to £31.7m in the 12 months to December 2015, down from a lost of £37.34m in 2014.

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Ovo is among the energy challengers trying to eat into the market share of the dominant Big Six. But these mid-sized suppliers have struggled due to the costs associated with tempting customers away.

Ovo was disappointed by the outcome of the Competition Market Authority's investigation into the energy market earlier this year. The report, which was also delayed, attracted criticism for its watered-down findings.

Steve Fitzpatrick, chief executive of Ovo, told City A.M. that he'd like the regulator Ofgem to do more as "competition drives the best outcome for customers but this only workers when good rules are well enforced."

Ovo added that 27 per cent of its customers have a smart meter installed, which is the highest proportion out of any top 10 supplier.

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Fitzpatrick also criticised the "alarmist" way a recent a recent report by MPs raising cyber security concerns around smart meters was communicated.

"[Cyber security] is something we take very seriously. We've spent a lot of time looking at how we interact with our meters ... and how we protect customer information and data," he added.

Ovo is the second-biggest independent energy supplier in the UK, with 700,000 customers.

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