British Gas makes profits of £3m

By Rowena Mason

Its parent company, the FTSE 100 giant Centrica, saw its pre-tax profits almost halve from £2bn in the first half of last year to £1.2bn last year. Revenue was almost flat at £11.5bn.

The British Gas division, which supplies homes and businesses with energy, saw profits drop sharply because of greater commodity price pressures and lower consumption.

Its residential supply business made £270m in the first half, which is 54pc lower than last year.

The company said this division would have been heading for a loss in the second half of the year, if British Gas had not taken the decision to raise prices.

Despite its choice to increase rates for customers, British Gas actually grew its market share in electricity by 0.8pc points, falling back 0.5pc points in gas.
 
“Global events have resulted in a steep increase in commodity prices, with UK wholesale gas prices 30pc higher than last winter,” said Sam Laidlaw, the chief executive of Centrica, in the results statement. “In this challenging market, the resilience of our integrated business model has enabled Centrica to continue to perform well.”

Centrica’s gas production and electricity generation division fared better than British Gas, making profits of £531m, up from £485m.

However, it admitted that its plans to invest in the UK’s first two nuclear power stations for a generation with EDF has been delayed. The company’s statement sounded more tentative about nuclear than it has done in the past, describing the plans as “an option”.

It said: “New nuclear build will be delivered later than we had originally hoped and we expect clarity on the revised timetable towards the end of the year. New nuclear build is an important option for us. However, we will only invest if we are satisfied that the returns represent good value for our shareholders.”

Centrica will pay an interim dividend of 4.29p per share, which is a 12pc increase.

Shares in Centrica edged up 2.87 - or 0.9pc - to 323.2p in early trading. Telegraph