1. ITV Report

British Gas owner to cut a further 2,100 jobs as profits drop dramatically

Centrica's profits dropped dramatically. Credit: PA

British Gas owner Centrica is set to cut a further 2,100 jobs as part of a cost-cutting process.

The group's £740 million cost-cutting programme has been delivered three years early after making a further £308 million in savings this year, Centrica confirmed on Thursday.

The latest reduction in jobs means headcount has dropped by 5,500 since the start of 2016 as the company aim to save £1.25 billion per year by 2020.

Centrica has blamed "significantly reduced profit" in its UK business for pushing group operating profits down 17 per cent to £1.25 billion.

Centrica's UK business operation suffered an incredible 92 per cent fall in adjusted operating profit to a mere £4 million for the entire year to December 31, but the home division enjoyed a one per cent increase.

It compounded pain caused by a drop in its North American business unit, resulting in a 17% fall in group adjusted operating profits to £1.25 billion, although on a statutory basis, operating profits plunged 80% to £486 million. Centrica said political meddling in the UK energy market had impacted its performance.

Centrica's group chief executive Iain Conn said: "Our financial result in the second half of 2017 was weak, primarily reflecting poor performance in business energy supply and particularly in our North America business unit.

Iain Conn spoke of "weak" financial results. Credit: PA

"The combination of political and regulatory intervention in the UK energy market, concerns over the loss of energy customers in the UK and the performance issue in North America have created material uncertainty around Centrica and, although we delivered on our financial targets for the year, this resulted in a very poor shareholder experience.

"We regret this deeply and I am determined to restore shareholder value and confidence. The underlying trends driving our strategy are clear, as are the distinctive capabilities we have to benefit from them.

"We are committed to delivering attractive returns and growth over the medium term.

"Our focus today is on performance delivery and financial discipline - on demonstrating top-line growth as we deliver improved service and new propositions for our customers, and driving efficiency as hard as possible to underpin our competitiveness."