British Gas warns over profits despite recent price hikes

British Gas has warned that its profits will not meet City forecasts just weeks after announcing price rises of up to 9.2%.

Shares in parent company Centrica fell sharply today after the announcement, which also added that price rises had been necessary in order to offset losses in its retail arm.

The firm said that group earnings, which were forecast to rise by 3-4%, would now likely remain flat on the £2.7bn reported for 2012.

Centrica said that it had absorbed rising costs in its British Gas residential business “for as long as possible”, but last month announced increases to electricity and gas prices by 10.4% and 8.4% respectively.

Shares in the company quickly fell by 3%.

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