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E.ON flags fierce retail competition after in line results

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By Reuters
E.ON flags fierce retail competition after in line results
FILE PHOTO: Electric car is charged at the charging station at the front of the German utility E.ON headquarters in Essen, Germany, May 9, 2018. REUTERS/Wolfgang Rattay/File Photo   -   Copyright  Wolfgang Rattay(Reuters)

FRANKFURT (Reuters) – E.ON <EONGn.DE>, Germany’s biggest energy group by market value, warned competition for household clients remained stiff after publishing first-half results that were in line with expectations on Wednesday.

To gain scale and better compete in the embattled market for retail electricity clients in Europe, E.ON in March unveiled plans to break up peer Innogy <IGY.DE> with rival RWE <RWEG.DE> and take on the company’s customer business.

“Our core business — Energy Networks, Customer Solutions, and Renewables — delivered good results, even though we continue to face fierce competition, primarily in our customer solutions business,” Chief Financial Officer Marc Spieker said.

Adjusted EBIT at E.ON’s Customer Solutions segment still rose 8 percent to 477 million euros (£428 pounds) in the period, against a 474 million analyst forecast, and the unit added about 100,000 household clients year-on-year, the group said.

On a group level, first-half adjusted earnings before interest and tax (EBIT) rose by 10 percent to 1.9 billion euros ($2.2 billion), in line with the average forecast in a Reuters poll of banks and brokerages.

Shares in the company were indicated up 0.8 percent at the top of Frankfurt’s blue-chip index, outperforming the benchmark DAX index, which was indicated to open unchanged.

(Reporting by Christoph Steitz; Editing by Edward Taylor and Victoria Bryan)