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British Gas profits jump to £571m | British Gas profits jump to £571m |
(20 minutes later) | |
Energy supplier British Gas has reported annual profits of £571m at its residential arm, up from £95m in 2006. | Energy supplier British Gas has reported annual profits of £571m at its residential arm, up from £95m in 2006. |
The news came as Centrica, British Gas' parent company, announced group pre-tax profits for last year of £2.1bn. | The news came as Centrica, British Gas' parent company, announced group pre-tax profits for last year of £2.1bn. |
Last month, British Gas said it would raise the amount it charges for gas and electricity by 15%, a move criticised by consumer groups and the Unite union. | Last month, British Gas said it would raise the amount it charges for gas and electricity by 15%, a move criticised by consumer groups and the Unite union. |
The announcement followed increases from rivals Npower and EDF Energy, who blamed rising wholesale costs. | The announcement followed increases from rivals Npower and EDF Energy, who blamed rising wholesale costs. |
Rising prices | Rising prices |
Operating profits across the Centrica group rose 40% to £1.95bn. | Operating profits across the Centrica group rose 40% to £1.95bn. |
Chairman Roger Carr said: "Centrica delivered very strong financial results during another challenging year for UK energy retailers." | Chairman Roger Carr said: "Centrica delivered very strong financial results during another challenging year for UK energy retailers." |
Consumers will feel justified in claiming that they are being taken for a very rough ride by energy companies Adam Scorer, Energywatch | |
The company said it had worked "diligently" to minimise the impact of rising wholesale energy prices in the latter part of 2007. | |
Centrica said two-thirds of the group's earnings were made in the first half of 2007, when wholesale gas prices were falling. | Centrica said two-thirds of the group's earnings were made in the first half of 2007, when wholesale gas prices were falling. |
British Gas did reduce customers' bills in March and April 2007, but consumer group Energywatch says energy companies did not pass on the full reduction to householders. | |
It has called for a Competition Commission investigation into the way the energy market works. | It has called for a Competition Commission investigation into the way the energy market works. |
"Consumers will be shocked at this massive increase in profits," said Tim Wolfenden from price comparison service Uswitch. | "Consumers will be shocked at this massive increase in profits," said Tim Wolfenden from price comparison service Uswitch. |
"They will be extremely disappointed and will start voting with their feet." | "They will be extremely disappointed and will start voting with their feet." |
Dividend up | |
Centrica said customer service at British Gas had "significantly improved", with 200,000 customers returning in the second half of last year. | Centrica said customer service at British Gas had "significantly improved", with 200,000 customers returning in the second half of last year. |
Overall the number of gas customers fell in 2007 by 2.4% to just over 10 million, while the numbers of electricity customers rose by 4.5% to just over six million. | |
Centrica has increased its full-year dividend to shareholders by 17% to 13 pence per share, a move criticised by consumer group Energywatch. | |
"It is perfectly true that there is volatility in wholesale energy markets. But it seems equally true that such volatility hits consumers not shareholders," Adam Scorer, Energywatch director of campaigns said. | |
"Consumers will feel justified in claiming that they are being taken for a very rough ride by energy companies," he added. |