British Gas owner Centrica has called on the UK government to provide more support for households hammered during the energy crisis even as it reinstated its dividends for the first time since 2020.
Chris O'Shea, chief executive, warned that the UK was facing what was likely to be a difficult winter with forecasts that the average annual UK household energy bill could soar towards 4,000 by the beginning of next year.
Higher revenues from its oil, gas and nuclear assets helped boost operating profits at the UK's biggest energy retailer to more than $1 billion in the first half of the year. It will pay a dividend of over $60 million.
Since taking the helm two years ago, O'Shea has helped return stability to the business, helped in part by rising energy prices.
The company is often a target for consumer anger when bills rise. O'Shea did not say if he would do the same thing next year.
"Energy groups' eye-watering profits are an insult to the millions of working people struggling to get by because of soaring energy bills", said the general secretary of the TUC.
The charity Citizens Advice warned on Thursday that it had already seen more people seek help about energy in the first half of the year than in the whole of the year.
O'Shea acknowledged that customers werestruggling and called for more action from the government, which launched a £15 billion support package for households in May.
The BFY Group warned on Wednesday that gas and electricity bills for the most vulnerable customers could go up as much as 500 a month in January.
According to O'Shea, the average household income in the UK is going to put a lot of pressure on people. According to the Office for National Statistics, the UK's median household income is more than $31,000 a year.
We don't know if there will be more government interference. We are very happy about that. More support for consumers has been called for by us.
O'Shea argued that the last year had shown the need for strong energy companies after the collapse of dozens of smaller UK energy suppliers.
The customers had to be transferred to larger operators.
The majority of the company's shareholders were normal UK citizens who bought a stake in the company when it was privatized by the Thatcher government.
The source of Centrica's profits is not rising customer energy bills, according to O'Shea.
Most of our shareholders are Sids. They're also struggling. We are paying a windfall tax of over half a billion dollars, so a lot of this is going back into society.
The British Gas Energy segment's operating profits fell due to the need to buy gas and electricity for new customers who were not hedged in advance.
The price of gas in Europe has gone up due to Russia's restrictions on supplies. They are now trading at about 10 times the average level of the past decade, stoking a cost of living crisis and contributing to a surge in inflation as energy prices filters through all areas of the economy.
O'Shea wouldn't say if the UK would face gas shortages this winter if Russia stopped exporting gas.
He said that the company is trying to restart the Rough offshore storage facility in order to bolster the UK's supply security.
Even though the UK is less exposed to direct Russian gas imports than mainland Europe, it can still rely on shipments from Belgium and the Netherlands for 15% of supplies on the cold days.
O'Shea was unable to commit to the facility being ready for the winter due to ongoing discussions with the government. It was estimated by the company that Rough could have saved consumers about 100 dollars on their bills. The cost of restarting the facility is not being asked for help from the government.
The security of supply in the UK could be changed by it.
In the first six months of the year, adjusted earnings before interest, taxes, depreciation and amortisation, including from oil and gas producing assets, increased to over one billion dollars, up from over six billion dollars in the first six months of the previous year. The company's adjusted earnings per share increased to 11p from 1.7p.
Additional reports by Jim and Delphine.
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