British Gas to post record rise in profits
BRITISH Gas owner Centrica is expected to post a record jump in profit for the first half of the year on Wednesday, thanks to the coldest winter in 30 years.
Some analysts have predicted up to a 95 per cent increase in profits, but the record sums could anger customers who called for the energy giant to cut prices in line with falling wholesale costs.
Citigroup analyst Peter Atherton said in a note he expects operating profits of around £583m from British Gas, up from £300m, with a further £132m generated at the group’s business division.
Goldman Sachs predicted that underlying profits will show a near 50 per cent rise in the last half, and that the residential energy business will post a record £624m profit.
While the home energy branch represents just a quarter of Centrica’s overall business, concerns over opaque pricing in the industry have put the spotlight on its operations.
British Gas was the first company to cut prices after the cold snap in February, but regulator Ofgem is still monitoring two unnamed energy companies for overcharging.
Meanwhile, it was reported yesterday that Centrica is in talks to buy several power stations owned by International Power, which is currently in takeover talks with GDF.
It is understood that talks are in an early stage for an undisclosed number of stations, and that Centrica will announce the news to the stock market this morning.
Centrica could not be reached for comment yesterday.