British Gas reports drop in profits
20/02/2014
British Gas have reported a small drop in profits from their residential business in 2013, citing factors such as warmer weather and increasing wholesale costs.
Operating profit for the full year was recorded at £571 million, a 6% reduction from £606 million in 2012. Furthermore, parent company Centrica also posted a small reduction in profits during the same time period as they reported a profit of £2.7 billion in 2013, down from £2.74 billion in the previous year.
These reductions in profit were despite overall revenue from parent company Centrica rising by 11% to £26.6 billion for 2013, with the reason for the reduction in profits being blamed largely on rising wholesale gas and electricity prices.
Additionally, British Gas claimed that customer numbers dropped by 2% (362,000) in 2013, whilst it has also lost a further 100,000 in 2014 so far. However, they also went on to state that customers numbers have began to stabilise following a recent price reduction.
Centrica’s Chief Executive, Sam Laidlaw, remained positive despite the reduction in profits, stating that he felt “good strategic progress” had been made in 2013 as they invested in the “gas value chain”. However, he did also go on to say that 2014 would "remain challenging, 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".
All the major energy companies have been criticised by both the press and government figureheads in recent months for raising energy prices, with British Gas being the first to do so in October last year when they increased prices by 9.2%.
The most recent criticism came from Energy Minister Ed Davey who wrote a letter to energy regulators, calling for them to study the dominance British Gas, asking them to consider all possible remedies, “including a break-up of any companies found to have monopoly power to the detriment of the consumer.”
Need advice?
If you need to ask a financial question then please contact our financial advisers online or over the phone to get help with your query.
Share this..
Related stories
UK wine sales under significant pressure
Figures released by the wine industry show a fall in wine sales in the UK for the first time in over a decade and only the second time in 20 years. The report, by Mintel, suggests that UK wine drinkers consumed 1.16 billion litres of wine which is a fall of 2% on the previous year. It seems as though a mixture of health issues, the recession and the ever increasing rate of tax on alcohol has final...
Read MoreGender pay gap in city is enormous
A report by the equality and human rights commission has blown wide open the massive gap in pay and bonuses between men and women in the financial sector. These startling figures indicate that the average male bonus in the sector is five times that of their female counterparts who earn up to 39% less overall. However the situation is far worse for those working within the "city".
Th...
Is The UK Holiday Sector Showing The Strain?
The Civil Aviation Authority has confirmed what many were starting to fear, that the holiday sector in the UK is going through one of the worst periods of recent times. Figures released this week show that a total of 25 firms went under during the year up to end March 2008 but it looks as though things could get worse before they get better. So is your money safe? Will you still get your holiday...
Read MorePublic Set For More Panic Buying Of Fuel
The warning signs have been there for a few days and it seems as though we are on the verge of yet another saga of panic fuel buying across the UK. The much publicised fuel delivery drivers strike seems set to go ahead from Friday this week, with the four day action set to paralyse Shell garages across the UK. But why is there a threat of large scale panic buying?
As we have seen...
U.K. scrapping scheme injects interest into the car market
Ahead of next week's official launch of the UK vehicle scrapping scheme many car manufacturers have reported increased interest from showrooms and web traffic. While the scheme has received significant criticism across the board many will be encouraged to see a surge of interest ahead of the scheme although whether this will follow through remains to be seen.
The option to scrap you...