Shares were up 4% after the owner of British Gas revealed profits were up 19%, beating low expectations stemming from the mild winter.
The company said it had delivered ‘resilient financial performance in a challenging environment’ with adjusted earnings per share down 4% to 17.2p, adjusted operating cash flow up 2% to £2.25bn and a 9% reduction in net debt to £4.74bn.
Elsewhere, BAE systems shares saw a modest rise of 1.1% in response to its full year numbers. The aerospace and defence company revealed a 7% rise in revenue to £17.9bn and a 15% rise in operating profit to £1.5bn. Sales of the Typhoon fighter jet were a major part of its success last year.
The company also forecast earnings growth of 10% for 2016 on increased demand for its defence and cyber security products.
The FTSE 100 was 0.4% down overall but still sat just above the 6000 point mark.
“These [Centrica] figures may come as a surprise to the market, as most were expecting the relatively mild winter conditions to have hurt the company,” said “Graham Spooner, investment research analyst at The Share Centre. “Investors should be aware that electricity and gas prices in Centrica’s core British market have fallen as a result of the fall in commodity prices. As expected, its oil and gas production unit has suffered from the lowest oil and gas prices in over a decade.
“Britain’s energy suppliers continue to face tighter regulation on the back of a competition investigation that could impose a limit on their most expensive energy tariffs,” Spooner continued. “Investors should appreciate that the group will continue to implement cost saving measures, particularly in its oil and gas division.”
The two sets of results will make reassuring reading for income investors according to AJ Bell investment director Russ Mould.
