British Gas Profit Up 99% As Parent Cuts Staff

The parent company of British Gas is to cut 10% of its workforce, 4,000 staff, as it moves to counter falling oil and gas prices.

While announcing its half-year results this morning, Centrica (LSE: CNA.L - news) said it planned 6,000 job losses but it would hire 2,000 new people as it set new priorities following a strategic review of the business, which includes the country's largest supplier of energy to households.

British Gas made an adjusted operating profit of £528m in the six months to 30 June - up 99% on the same period last year.

It said a colder spring was the core reason for the increase, with consumption rising 11%.

But Ann Robinson, director of consumer policy at uSwitch.com, claimed "sky-high bills" were also a factor.

She (Munich: SOQ.MU - news) said: "Wholesale prices, which make up around half of energy bills, have plunged to their lowest level in five years.

"Although British Gas is the only 'big six' supplier to reduce gas prices twice this year, the fact remains that the combined cuts will lower its average dual fuel bill by just 6%.

"Meanwhile, why are consumers still waiting for EDF Energy, E.ON, npower, ScottishPower and SSE (LSE: SSE.L - news) to make further reductions?

"Suppliers must do the right thing by passing on savings to help consumers, who are struggling with bills which are £700 a year higher than they were ten years ago."

Centrica's group adjusted operating profits fell 3% to £1bn over the six months.

Commenting on the strategic review, the company said half the job losses would be achieved through redundancy and its focus would now be on customer-facing businesses.

Its new investment plans reflected that while it said cost-savings would total £750m over five years.