British Gas owner's profits triple to £3.3billion amid 'challenging environment for customers and communities'

16 February 2023, 07:46 | Updated: 16 February 2023, 08:24

Chris O'Shea, CEO of Centrica
Chris O'Shea, CEO of Centrica. Picture: Centrica/Getty

By Kit Heren

Centrica, the company that owns British Gas, has posted record annual profits after a year in which energy prices have skyrocketed.

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The company's full-year operating profits for 2022 reached £3.3 billion, more than three times higher than the £948 million posted the year before.

Centrica's previous highest operating profits were £2.7 billion in 2012.

Energy companies' earnings have leapt up amid higher wholesale prices driven by the war in Ukraine.

It comes amid concerns over Centrica using debt collectors to put in expensive pre-payment meters by force in the homes of vulnerable customers who were strapped for cash.

British gas will be 'forced to pay compensation to customers with force-fitted prepayment meters'

The scandal sparked an urgent inquiry by regulator Ofgem and has seen Centrica banned from force-fitting pre-payment meters.

Most of the earnings come from Centrica's oil and gas sales, rather than the British Gas' energy supply business. Centrica said that profits at British Gas itself had dropped nearly 40% compared with 2021, in part due to "voluntary donations made to support customers".

Some of Centrica's business is subject to a windfall tax on energy companies whose profits have soared in the crisis.

"Our performance in 2022 demonstrates the benefits of our balanced portfolio and our strong balance sheet, Centrica boss Chris O'Shea said, admitting that "the energy crisis and cost of living pressures have created a challenging environment for customers and communities".

Former Prime Minister Liz Truss speaking to Centrica CEO Chris O'Shea
Former Prime Minister Liz Truss speaking to Centrica CEO Chris O'Shea. Picture: Getty

He added: "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."

But Unite union general secretary Sharon Graham reacted angrily to the news of Centrica's bumper profits.

Read more: British Gas will be 'told to pay compensation to customers with force-fitted prepayment meters' if wrongly installed

Read more: Fury as British Gas debt collectors force their way into vulnerable people's homes to install prepayment meters

She said: "British Gas owner Centrica has been coining it in from our massive energy bills while sending bailiffs to prey on vulnerable consumers the length and breadth of the country.

"These energy companies are showing us everything that is wrong with the UK's broken economy.

"Rishi Sunak should get a grip - pull the plug on rampaging energy profiteering, impose a meaningful, tough windfall tax and give the NHS a pay rise with the proceeds."

Centrica said it paid nearly £1 billion in tax relating to 2022 profits.

But it also revealed it handed out bumper returns to shareholders, with plans to boost its share buyback programme by another £300 million and paying out a full-year dividend of 3p a share.

Shadow climate secretary Ed Miliband hit out at the Government as he promised that Labour would introduce a "proper" windfall tax on energy companies.

"It cannot be right that, as oil and gas giants rake in the windfalls of war, Rishi Sunak's Conservatives refuse to implement a proper windfall tax that would make them pay their fair share," Mr Miliband tweeted.

"Labour would use a real windfall tax to stop the energy price cap going up in April."

In the figures, Centrica said it was "extremely disappointed" by the pre-payment meter allegations over the tactics used by the debt collectors it employed.

"We immediately took action to address this and are completing a thorough independent investigation," it added.

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