Centrica sees earnings in British Gas supply arm more than halve in 2024

Centrica said the majority of the fall was due to the absence of energy crisis allowance payments.

Regulator Ofgem allowed energy suppliers to recover costs that they had racked up during the crisis, but this came to an end last year.

Centrica also revealed it shed 70,000 household customers in the year, with its total residential customer base falling to 7.46 million in 2024 from 7.53 million in 2023.

The wider Centrica business reported a 40 per cent drop in underlying operating profits to £1.55bn for 2024, down sharply on the £2.75bn the previous year.

On a statutory basis, Centrica’s operating profits fell to £1.70bn from £6.51bn in 2023.

The results come as energy experts Cornwall Insight this week forecast more bills pain for households, predicting an £85 rise in the Ofgem price cap to £1,823 in April.

Chief executive Chris O’Shea said it was a good year for Centrica, but stressed there was “so much more we can do”.

He added: “Looking ahead, I want to see Centrica continue to focus on the areas that make the biggest difference.

“We are investing in the energy transition, ensuring our customers have the energy they need, when they need it at a price they can afford.

“Everything we do must deliver an appropriate return, and our investments during 2024 demonstrate our ability to invest responsibly and profitably.”

Mr O’Shea added: “Centrica has been transformed in recent years, and most of our businesses delivered against our medium-term expectations two years ahead of schedule.

"We now have greater resilience and financial flexibility supporting the capital returns, dividend increases and new investments in Ireland announced today. Our confidence in the future is as strong as it's been for a long time and I look forward to continuing to deliver for our colleagues, our customers and our shareholders.”

The group added that earnings in its household supply business would recover to stand “within their medium-term sustainable adjusted operating profit ranges for 2025”.

The results showed its capital spending ramped up to £564 million in 2024 from £415 million in 2023.

It announced further returns for its army of small shareholders, with a 13 per cent full-year dividend increase and an extra £500m in share buybacks, taking the total programme to £2bn, which will be completed around the end of 2025.