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Centrica profits hit record high of £3.3bn

Profits at Centrica more than tripled year on year to a record high of £3.3bn in 2022, as the energy group’s North Sea production and nuclear power businesses benefited from a surge in gas and power prices.

The owner of British Gas, which has recently been embroiled in a scandal over forcibly installing expensive prepayment meters in the homes of vulnerable customers, said it would expand a £250mn share buyback programme launched last year by an additional £300mn following the results. The share buyback programme is its first since 2014.

Adjusting operating profits more than tripled last year from £948mn in 2021. Profits at Centrica’s energy trading arm rose twentyfold to £1.4bn in 2022 as it benefited from the market volatility.

The results are likely to spark further debate over whether energy companies that have made record profits from high wholesale gas and power prices should be doing more to help vulnerable households dealing with high inflation.

George Dibb, head of the Centre for Economic Justice at the think-tank IPPR, said Centrica’s profits were “scandalous” and called for a tax on share buybacks. “We all know that wholesale energy prices have been sky-high for the past year, but that’s no reason that gas suppliers should be making higher profits on the back of higher bills,” Dibb said. “These profits, which are then being transferred directly to shareholders via buybacks and dividends, are a direct transfer away from bill-payers during a cost of living crisis.”

Centrica chief executive Chris O’Shea insisted that the company had invested more in helping its customers with soaring energy bills than the £8 profit per customer it made after tax in its British Gas Energy division, which supplies households with electricity and gas.

The company also said it paid around £1bn in tax for 2022 after the UK government last year introduced a windfall tax on oil and gas producers. A similar levy on electricity generators came into force at the start of this year.

O’Shea said: “Whilst customers may see some relief given recent easing of prices, it remains clear that some will continue to need help and we will do what we can to support them in the year ahead.”

The company repeated that it was “extremely disappointed” by the findings of a recent Times newspaper investigation that found a third-party contractor working on British Gas’s behalf had broken into vulnerable customers’ homes to fit prepayment meters, which are more expensive than paying for energy bills by direct debit.

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