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British Gas reports £574 million profit last year

Operating profits for British Gas residential arm rose by 31%. Credit: PA

Britain's biggest residential energy supplier British Gas has reported a sharp increase in profits for 2015.

Energy group Centrica confirmed a 31% increase in operating profits at its British Gas residential arm at £574 million last year.

However, wider group underlying earnings at owner Centrica fell 12% to £1.46 billion.

Operating profit the previous year was at £439 million.

Earlier this month, the company announced it is cutting 500 jobs saying it had to be competitive in a "fast-changing" energy market.

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British Gas to cut 500 jobs

British Gas has announced it is cutting 500 jobs.

The job losses will be hitting its loft and cavity wall insulation business, as part of the company's efficiencies programme.

British Gas has announced it is cutting 500 jobs. Credit: REUTERS/Toby Melville

Brian Strutton, national officer of the GMB union described the announcement as "a real sickener".

The jobs are part of 6,000 cuts announced by owner Centrica last summer, with the group saying it had to be competitive in a "fast-changing" energy market.

Mark Hodges, chief executive, energy supply and services, UK and Ireland at British Gas said the company was focused on improving its efficiency and effectiveness.

"British Gas is well positioned to grow, but we must ensure that our costs allow us to be competitive for our customers."

British Gas announces it will cut gas prices by 5%

Credit: PA

British Gas has announced it will cut household gas prices by 5%.

It is the second gas price reduction in six months and is expected to save customers an average of £72.

The price cut will come into effect from August 27 benefitting 6 million customers on the Standard Fix & Fall tariffs.

Managing Director Mark Hodges said: "British Gas is committed to offering competitively priced products, and the price cut we’re announcing today demonstrates that.

"This reduction reflects our lower projected total costs for 2015 and 2016 and we’re pleased that customers will see the benefits in their gas bills ahead of next winter."

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British Gas fined £11.1 million by Ofgem

British Gas has been fined £11.1 million by regulator Ofgem after it failed to deliver energy efficiency measures on time.

British Gas will pay the money to charity.

British Gas fined £11.1 million by Ofgem Credit: Nick Ansell/PA Wire

The regulator said British Gas delivered just 62.4% of its Community Energy Saving Programme (CESP) by the required deadline at the end of 2012, meaning thousands of households had to wait for energy efficiency measures, such as insulation, to be installed during the winter.

Ofgem and British Gas, which blamed bad weather as one of the factors behind the delay, said the £11.1 million penalty will be used to help vulnerable customers through energy efficiency advice and improvements.

Ed Miliband energy freeze 'will bring up bills'

Energy bills are likely to go up in the longer run if Labour come to power, the chief executive of British Gas owner Centrica has told ITV News.

Ed Miliband pledged an energy price freeze if Labour wins the election. Credit: PA

Leader Ed Miliband pledged to freeze energy bills for 20 months if his party wins the general election, but Sam Laidlaw says the plans are likely to scare investors, thereby raising the cost of capital for energy companies and in turn leading to higher bills.

Asked if the plans were already having such an effect, Mr Laidlaw said general "political uncertainty" was raising the cost of capital for energy firms.

British Gas to make £40 profit per customer, boss says

The boss of British Gas parent Centrica has told ITV News the company will make far less profit from energy bills than watchdog Ofgem has suggested.

Chief executive Sam Laidlaw told ITV News Business Editor Joel Hills the energy firm would make £40 profit per customer per year - some way from the £106 Ofgem says energy companies are set to make.

He added the watchdog's estimates were "not an accurate representation" and do not "help consumer trust".

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