The BBC reports that Npower has been “plagued by customer complaints over billing and in December was fined, by the energy’s industry regulator, a record £26 million (£37 million) for those problems”.
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Its German parent, RWE, said a “radical restructuring” of the United Kingdom supply business was getting underway, just days after Sky News reported the shake-up would result in 20% of npower’s United Kingdom workforce losing their jobs.
RWE promoted Paul Coffey to Npower chief executive officer in August in a management shakeup to reverse a slump in the unit’s performance.
The job losses come as Npower announced annual losses of €137m (£106m) compared with €227m profit in 2014.
Npower’s operating loss was 137 million euros ($151 million) compared with a profit of 227 million euros a year earlier, the Essen, Germany-based company said Tuesday in a statement.
The energy company, which is one of the bix six in the United Kingdom, employs 11,500 people including outsourced staff with 7,500 of those working directly for npower in the UK.
The job losses, over the next two years, will be spread across its sites and amount to just under 21 per cent of its workforce.
“We’re calling for an emergency meeting so we can work jointly on finding a way out of the mess the company now finds itself in”, said Dave Prentis, the general secretary of Unison.
Energy giant Npower is to cut 2,400 jobs, but the North East appears to have escaped the worst of the cuts. Last month, the company closed its office in Burton, with the loss of about 200 staff. The stock has shed more than half of its value over the past year, pressured by factors including uncertainty over the cost of shutting down of its nuclear plants.
“(The results) show a business that tried to do too much too soon, while not focusing enough on the fundamentals”, he said, which led to “complicated processes and procedures resulting in unhappy customers, too many complaints and extra costs to put things right”.
The cuts are a response to customer numbers diving from 5.13 million to 4.77 million – with npower blaming billing problems and competition.
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RWE has said it would retain majority ownership in the new company, but float around 10% by year-end.
