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British Gas owner Centrica reports 2% operating profit rise

Centrica owns British Gas. Credit: PA

British Gas owner Centrica has fuelled further controversy after reporting profit rises.

It reported a two per cent rise in UK and Ireland operating profits to £906 million, helping group operating profits jump four per cent to £1.5 billion.

The company is expected to face fresh calls to address tariffs for businesses and domestic consumers.

Centrica's British Gas residential energy supply arm, which only covers UK homes, reported an 11% drop in operating profits to £553 million, compared with £623 million in 2015, but said the reduction was due in part to a customer exodus.

More than 409,000 UK home customers left the business in 2016, marking a 3% fall to 14.25 million.

British Gas announced it was extending a price freeze on its standard energy tariff until August, "despite increases in external costs", but customers are expecting prices to soar later this year, following the Brexit-induced collapse of the pound and rising wholesale energy prices.

The industry has faced increasing pressure to treat loyal customers fairly and has been criticised for being slow to pass on falls in wholesale gas prices, with consumer groups hitting out at the size and timing of cuts.

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Tesco to merge with Booker in £3.7bn deal

Chief Executive Dave Lewis said the merger will further enhance growth prospects. Credit: PA

Tesco has reached an agreement to merge with food wholesaler Booker in a £3.7 billion deal.

The supermarket giant said the agreement will create "the UK's leading food business" and deliver significant efficiency savings for the combined group.

ITV News Consumer Editor Chris Choi said it raises questions over market dominance:

Tesco chief executive Dave Lewis said: "Tesco has made significant progress in turning around our UK retail business.

"This merger with Booker will further enhance Tesco's growth prospects by creating the UK's leading food business with combined expertise in retail, wholesale, supply chain and digital."

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