Bord Gáis Energy owner Centrica to cut 4,000 jobs

Bord Gáis Energy owner Centrica, will sell up to £1 billion worth of upstream and wind assets by 2017 and reduce net headcount by around 4,000 staff as it looks to put more emphasis on energy supply and services.

The move comes as Centrica said that Bord Gáis Energy contributed £23 million (€32.7 million) to the group’s bottom line with the number of residential accounts down 1 per cent to 600,000.

“Bord Gáis Energy performed well, having also experienced colder than normal weather which resulted in higher than normal gas consumption. Energy accounts were broadly flat over the period, with our price reduction in March positioning us with the cheapest standard dual fuel offering amongst major competitors, while we also commenced the roll-out of our Hive smart thermostat,” the group said.

“In power generation, the 445MW Whitegate gas-fired station performed well in the first six months, with strong availability and reliability,” it added.

The owner of energy supplier British Gas reported a three percent fall in first-half adjusted operating profit to £1 billion , meeting expectations.

The group reduced its interim dividend by 30 per cent to 3.57 pence, as announced earlier.

Centrica said cost cuts including the job losses would save around £750 million a year by 2020.

Many European utilities are looking for new strategies as their decades-old model of centralised, predictable energy production and consumption grapples with falling power prices and reduced consumption.

Under new chief executive, former BP man Iain Conn, the company will focus on “customer-facing activities” such as British Gas which is the country’s largest energy provider, supplying around 11 million homes.

Mr Conn said Centrica had made solid progress reducing the company's net debt and strengthening its balance sheet.

He said it was now “well placed to compete materially against the emerging long-term trends in global energy markets”.

Centrica will also invest £250 million over the next five years to expand its North American retail business. Some analysts had expected the company to consider selling parts of that business.

The company’s nuclear assets will also be retained.

Additional reporting: Reuters