Gas group results

News

Centrica has announced its 2009 interim results, reporting a five per cent drop in operating profits to £936m for the first half of this year.

British Gas, part of the Centrica Group, reported a dramatic 80 per cent increase in profits, which analysts attribute in part to high gas prices in 2008 and the colder winter.

The residential energy sector of British Gas posted £4.3bn revenue for the first half of 2009 compared to £3.8bn this time last year.

Centrica also announced plans to grow the company, which could include a takeover of Venture Production if the North Sea oil and gas producer agrees to a £1.3bn cash offer. Centrica currently has a 29.9 per cent stake in Venture.

Other areas of interest for Centrica include the creation of 3,000 new skilled and ‘green-collar’ jobs by 2011, including the creation of a smart-metering business.

Sam Laidlaw, chief executive of Centrica, said the company is continuing to make efforts in bringing together the three segments of British Gas under one management structure.

‘The changes we are making to the business model make Centrica more resilient to volatile commodity prices,’ he added. ‘The new business structure in British Gas will continue to improve the way we serve our customers, particularly those in economic hardship, and the value of the propositions we offer.’

Laidlaw said Centrica has also made an agreement with EDF to take a 20 per cent equity stake in the British Energy generation fleet and the right to participate in nuclear new build.

The deal will involve the sale of Centrica’s Belgian business, SPE. Laidlaw said the move will allow the company to focus on increasing business in the UK and North America.

‘Tough economic conditions also present opportunities for Centrica, a business with a strong balance sheet and a good track record of investment,’ he said. ‘We will continue to target our capital at areas that provide strong returns for shareholders and address the important issues of security of supply and climate change in the UK and North America.’