* Expects operating profit to decline by 13 pct in 2019
* Lost 657,000 customers in Britain in 2018
* Takes 1.5 bln euro writedown on Npower (Adds details on customers in Britain, shares)
FRANKFURT/ESSEN, March 13 (Reuters) - German energy group Innogy on Wednesday forecast a 13-percent drop in operating profit this year, as competition in the British retail market remains tough following a failed attempt to merge its local unit with that of SSE.
The group, which was carved out of utility parent RWE in 2016, has been losing customers in Britain, where billing issues, a price cap and smaller rivals have made it hard to turn a profit.
“In the UK retail business, we project a steep decline in earnings due to the introduction of the price cap for standard variable tariffs in 2019 and rising commodity prices,” Innogy said in it annual report.
In 2018, Innogy, which will be broken up under a deal between RWE and rival E.ON, lost 657,000 electricity and gas clients in Britain, or 14 percent of its customers there.
Npower, the group’s British retail unit, posted an operating loss of 72 million euros for 2018, wider than the 63 million in the previous year. Innogy had to take a 1.5 billion euro writedown on the asset.
Shares in Innogy, Germany’s largest energy group by market value, were indicated to open 1.6 percent lower, among the biggest decliners in Germany’s midcap index. ($1 = 0.8861 euros) (Reporting by Christoph Steitz and Matthias Inverardi; Editing by Riham Alkousaa and Shreejay Sinha)