British Gas reports fall in profits
The gas and electricity supplier blamed an exodus of customers and rising wholesale costs for its results
Centrica today revealed that British Gas, part of its portfolio of companies, saw profits of its residential arm fall by 6% in 2013.
The drop in profits occurred despite British Gas hiking gas and electricity prices by 9.2% in November 2013.
British Gas is the largest energy supplier in the UK and made a profit of £571 in 2013.
Customers leaving to find better deals
According to Centrica, British Gas lost roughly 2% of its customers last year following its winter price hike. A further 100,000 left during 2014, but the company claims the exodus is now stabilising as British Gas has reduced the winter increase by 3.2% following government led cuts to green levies.
Business conditions in general were described as “challenging” and unusual weather patterns and margin pressures driving rising fuel costs were also blamed for the fall in profits.
Price freeze is ‘not a credible solution’
Chief Executive of Centrica Sam Laidlaw took aim at Labour leader Ed Miliband’s pledge to freeze energy prices should he win the next election, describing the proposal as “not a credible solution”.
Centrica has seen its share value drop by close to a fifth following Miliband’s price freeze announcement and comments made by Energy Secretary Ed Davey, suggesting British Gas could be broken up to increase competition.