10th May 2022 08:34
(Alliance News) - Centrica PLC on Tuesday said it has kicked off 2022 promisingly and expects annual earnings at the top end of analyst expectations, despite seeing inflationary and supply chain "headwinds".
Shares in the Windsor, Berkshire-based power utility were 5.8% higher at 76.08 pence each in London on Tuesday morning, among the best FTSE 250-listed performers.
The British Gas-owner forecasts its 2022 adjusted earnings per share to be around the top of a 6.7p to 10.8p range. At the very least, this would be 63% higher than the 4.1p adjusted basic earnings per share it achieved in 2021.
It has delivered a "strong operational performance" in the first four months of 2022, though Centrica said it has not been all plain sailing.
In the British Gas Services & Solutions, Centrica said it has seen "some supply chain disruption and higher inflation impacting both the cost base and customer demand".
"We expect those headwinds to continue to, at least partially, offset underlying operational progress for the duration of this period of higher inflation," Centrica added.
Nuclear and gas production volumes in the UK have been "strong", meanwhile.
Centrica added: "Our Energy Marketing & Trading business has both secured increased volumes of gas and renewable energy to improve the UK and Europe's security of supply and managed increased commodity price volatility well."
Looking to the rest of the year, Centrica warned of "significant uncertainties". Weather, commodity prices and the possibility of bad debt charges could hit the business this year, it cautioned.
It earmarked GBP50 million worth of investment, planning to add 500 more UK-based customer service roles in British Gas Energy and 1,000 new UK engineering apprenticeships. The investment also will go to a fund which will provide grants of up to GBP750 for people struggling to pay energy bills.
The UK energy watchdog in February lifted its annual price cap by more than 50% to GBP1,971 from GBP1,277, as wholesale gas prices continue to surge. The cap affects 22 million customers and was effective from April.
Away from soaring UK energy costs, Centrica said its disposal of Spirit Energy's Norwegian oil and gas assets are on track to be sealed in the second quarter, subject to Norwegian regulatory approvals.
Centrica announced the GBP800 million sale back in December.
Centrica added: "We have now started to evaluate longer-term options for repurposing Spirit Energy's retained UK assets to aid the energy transition and also continue to progress options to convert our Rough and Easington facilities to enable the UK's hydrogen targets."
The company will report interim results on July 28.
By Eric Cunha; [email protected]
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