British Gas profits go down by 6% compared to previous year

British Gas owner Centrica has just revealed that its residential energy arm has managed to achieve an overall profit of £571m, down 6% compared to the previous year.

Within its yearly financial results statement, the company acknowledged the fact that it has lost close to 2% of its residential customers last year, due largely to the energy price rises it imposed in Autumn 2013. Even so, they still have around 15.3-million customers, and the trend has now started to stabilize, after British Gas scaled back its price rise by 3.2% following a shake-up of the government’s so-called green levies on bills.

Results showed that higher wholesale prices and unseasonally warm weather at the end of last year saw British Gas suffer an 18% slump in operating profit in the final six months of 2013, which offset a better start to the year.

Mr. Sam Laidlaw, Centrica’s Chief Executive, said: “We have made good strategic progress across the Group in 2013, investing along the gas value chain to secure long term, affordable energy supplies for our customers. We have completed strategic reviews in both British Gas and Direct Energy, and introduced new management structures. These will help us deliver consistent, high quality customer service, reduce costs and drive growth through innovation. In Centrica Energy, we entered into a number of key strategic transactions to drive long term growth and we also added reserves from the drill-bit, mainly in Norway.”

He added: “Market conditions are set to remain challenging in 2014 with margin pressures and unusual weather patterns on both sides of the Atlantic, rising unit costs in the North Sea and weak economics for gas storage and gas-fired power generation. However in the short term, we are focused in our downstream businesses on improving service levels, reducing costs and returning to growth through innovation, technology and customer propositions.”

“Upstream, we will continue to drive efficiencies and will be increasingly selective in our investments, focusing on the projects that offer the best returns and the lowest political risk. The acquisitions we announced in 2013 are performing well and together with the positive action we are taking across the Group, position Centrica well for the future, for the benefit of both customers and shareholders”, he concluded.