Centrica ‘on track’ to hit £2.4bn profit

By MARTIN FLANAGAN
Published on 15/11/2012 07:54

SCOTTISH Gas owner Centrica today indicated it is likely to meet City expectations of a £2.4 billion profit in 2012.

In its latest trading update, the company said the weak UK economy was hitting demand from business but that cost cutting was helping it grow its residential division.

Centrica, whose main business is gas and oil exploration and production, said it expected to post overall earnings growth for this year in line with market expectations.

The City consensus is for a slight increase in underlying pre-tax profits to £2.4bn from £2.3bn in 2011. Earnings per share are forecast to have risen to 26.85p from 25.60p.

Analysts also predict about £575 million of profit from Centrica’s British Gas arm. The group said yesterday that gas consumption for the first ten months of 2012 was

9 per cent higher due to colder-than-normal weather.

Centrica said average electricity consumption was 1 per cent lower. The company said it had 15.8 million UK residential energy accounts, slightly lower than at the half year.

The firm added that higher costs to help upgrade the country’s gas and electricity grids, and to meet the government’s “green” carbon reduction targets, had added about £50 to the cost of supplying the average UK household.

The company said that in its exploration and production business all three of the North Sea acquisitions announced between late 2011 and February 2012 had now been completed.