UK gas owners expect earnings to rise eightfold amid rising gas prices

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UK gas owners expect earnings to rise eightfold amid rising gas prices


Owner of British Gas, Centricexpects earnings to grow nearly eightfold this year as its balance sheet was boosted by soaring wholesale gas prices after Russia’s invasion of Ukraine.

The FTSE 100 Group said Thursday it expects earnings per share to exceed 30p for the current financial year. This represents an improvement to Citi’s forecast of 26.6p from 23.6p and well above the 4p in 2021 when pre-tax profit reached £761m.

This is the third time in the financial year and the second time in three months that Centrica has raised its annual guidance.

In an unscheduled and brief statement to investors, Centrica said it “continued to deliver strong performance from its well-balanced portfolio” and said it had more than £1bn of cash on its balance sheet this year. I expect.

The statement risks stoking further anger over profits earned by energy producers since the outbreak of war in Ukraine.

The company, alongside British oil and gas giants BP and Shell, faced criticism About last year’s report of significant gains while consumers struggled with their bills.

Centrica said in November that the performance of its North Sea gas field and power generation assets (which owns 20% of the UK’s nuclear power plants) meant full-year earnings were nearing the upper end of expectations.

RBC analyst Alexander Wheeler said, “This upgrade appears to be driven by higher gains in trading and gas storage operations, a continuation of the theme Centrica has seen throughout the year.”

The company last year reinstated its dividend with a £59m payout to shareholders, and in November £250m share buybackfor the first time since 2014.

But analysts expect Centrica’s business, which supplies gas and electricity to homes, to suffer losses in the second half of the year.British gas last year announced Donate 10% of profits to help poor customers manage their rising gas and electricity bills “during the energy crisis”.

After gaining more than 30% over the past 12 months, Centrica’s shares rose 6% to 97p on Thursday morning, the top gainer in the FTSE 100.

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