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British Gas owner sees profits fall

Centrica, the owner of British Gas, has reported a big fall in profits after being hit by the drop in oil prices and by warmer weather, the BBC has reported.

Profits at British Gas’s residential business fell by 23% to £439m after warmer weather meant households used less energy for heating.

Centrica said the fall in global oil and gas prices had forced it to write off £1.4bn from its balance sheet.

It also announced that two gas-fired power stations – Killingholme and Brigg, both on Humberside – are to close as they were losing money.

In early morning trade in London, shares in Centrica were down by 7.4%, or 20p, at 261 pence.

Centrica also said it was having to cut capital investment in the North Sea by 40% between now and 2016, as its planned returns from the region were being “completely compressed”.

The average residential customer bill , which stood at £1,152 in 2014, was around £100 lower than in 2013.

The number of residential accounts supplied by British Gas fell by 368,000 in 2014 to end the year on 14.8 million.

British Gas said it had experienced a significant loss of customers in the first quarter of 2014 after an increase in residential prices in November 2013, but that the rate of customer loss was reduced over the rest of the year.

The volume of gas it sold in 2014 fell by 20% and electricity by 8%.

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