British Gas owner Centrica benefited last year from being able to claw back money that it had lost during the energy crisis.
Regulator Ofgem allowed energy suppliers to recover costs that they had racked up during the crisis in order
But adjusted profit fell to £2.8 billion before tax, compared with £3.2 billion the year before, the business revealed on Thursday.
Adjusted operating profit in the business’s retail unit, which is mainly made up of British Gas but also Irish supplier Bord Gais, soared from £94 million to £799 million as a result of the cost recovery, Centrica said.
This was lower than the record £969 million that the business had made in the first half of the year alone.
This is because British Gas was allowed to recover the extra £500 million through the price cap in the first six months of the year.
On a statutory basis thanks to the way that Centrica buys energy in advance it made a profit of £6.5 billion last year before tax, up from a loss of £383 million in 2022.
“We are pleased to report that this strong underlying operational performance has continued into early 2024,” said chief executive Chris O’Shea.
“As you would expect, sharply lower commodity prices and reduced volatility will naturally lower earnings in comparison to 2023 as we return to a more normalised environment.
“Our performance over the past year has reinforced our confidence in delivering against our medium-term sustainable profit ambitions and continuing to create value for shareholders.”