Centrica enjoys strong quarter

17th Nov 2010 07:02

Utility group Centrica had a strong third quarter, with operating profit forecasts for 2010 "slightly" ahead of current market expectations, though earnings per share will likely match estimates.British Gas, which last week announced a 7% hike in bills for both electricity and gas, is still doing well. The number of residential energy accounts on supply is up 270,000 since the start of the year, while services accounts have jumped 181,000. It's also making good progress towards the strategic priorities set out earlier this year. It blamed "significantly higher" forward wholesale gas and power prices for 2011 for the price increases, while other costs, such as network charges and environmental obligations, are also on the rise. Residential gas consumption fell 2% and electricity usage was down 1%.The government's scrappage scheme was good for the boiler installation business. It put in 29% more of them in the first ten months of 2010.There's also good news at the business energy supply and services division, which remains on track to deliver "substantially" increased year on year profit. It's been a "strong" production period for the upstream UK business production, with gas and oil volumes for the full year seen up 50% on 2009, reflecting the acquisition of Venture and increased volumes from Morecambe, which was shut down for long periods last year.In North American, the downstream business - residential and business energy supply - has made good progress, Centrica says, both operationally and financially, though the market environment remains "challenging" upstream, as low gas prices across North America and low spark spreads in Texas hit impact the returns from existing upstream assets.