It seems British Gas is set to announce an increase in residential profits of as much as 25% for the first half of the year while British Gas Business profits have fallen.
British Gas is set to announce an increase in profits of as much as 25% for the first 6 months of the year as the cold summer weather has forced homeowners to keep their heating turned on.
The energy giant is set to face pressure from both homeowners and MPs when it announces its results later this week. There are predictions that extra profits could be as much as £100m.
The labour MP for Glasgow North East, William Bain said the expected results mad it “increasingly clear” that the Big Six energy suppliers acted as a monopoly and he said this monopoly should be broken up.
However, while profits for the residential part of British Gas are set to be 25% higher, British Gas Business is likely to see earnings fall by 25%. It’s believed that this fall is due to a fall in business customers and pressure on profit margins.
It’s likely that Centrica, owner of British Gas will defend its profits by explaining that it actually reduced electricity prices earlier this year, something which was reported at the time by Utility Exchange. The company is also likely to argue that last year’s figures were lower because of the warmer weather which meant households used less gas for heating their homes.
Meanwhile Consumer Focus said household bills were higher than ever and that British Gas had hinted recently that prices would have to go up even further. Back in May Utility Exchange reported that British Gas warned that energy prices would rise at the end of the summer because wholesale gas prices for this winter are 15% higher.
Centrica argues that it is investing heavily in order to promote growth saying it’s “investing £2 for every £1 earned”.