Telecom Plus, which bundles together energy, telecoms and broadband services, today said it is hoping to lure more customers away from the big six energy suppliers this summer, despite experiencing one of its toughest-ever trading periods.
The owner of the Utility Warehouse brand said the big six and major telecom operators were charging higher margins to their oldest customers to fund introductory deals for those who switch.
The company is hoping that either the Competition and Markets Authority, which reports on the energy market this summer, or Ofgem will step in to prevent such activity.
Chief executive Andrew Lindsay said: “The practice of cross-subsidy is fundamentally unfair and we think that the regulator or the CMA needs to step in before it goes too far.”
Lindsay also called for the Secretary of State for Energy, Amber Rudd, to keep the pressure on the big six firms to pass on lower wholesale costs to their customers.
Falling wholesale energy prices, ferocious competition from rivals and a mild winter which led to lower energy use have all taken their toll on the company.
Telecom Plus, which was rocked by a profit warning earlier this year when it had to write off £11 million due to stolen gas, said that its revenues had climbed by 10.5% to £729.2 million in the year to the end of March. The company’s underlying, pre-tax profits climbed by 21.3% to £42.1 million.
Telecom Plus said that it now has 580,000 “members” and is offering 2.1 million services to its members.
It said it remains on track to reach a medium-term target of a million members which represents a 4% market share — although growth in members is expected to slow when competition in the market is toughest.
Unlike the big six, Telecom Plus avoids marketing campaigns and finds new customers through a network of partners who earn a small percentage of the monthly bill generated by members.
Telecom Plus shares climbed 3.41% to 849p.
