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AIBU?

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Gas profit for the six months ending in June rose to £1.34bn from £262m a year earlier.

32 replies

FirstCoffeeOfTheDay · 28/07/2022 08:06

I don't get it can someone explain in really simple terms how gas profits are rising?

I thought the prices of gas was going up because the wholesale price is up, so therefore, the profits should stay broadly the same.

?

OP posts:
TopSec · 28/07/2022 15:31

FirstCoffeeOfTheDay · 28/07/2022 08:06

I don't get it can someone explain in really simple terms how gas profits are rising?

I thought the prices of gas was going up because the wholesale price is up, so therefore, the profits should stay broadly the same.

?

I have just put this on another thread - they have managed it because folk have been asked to put up their direct debits far higher than they needed to be i.e. the gas went up by, I believe, 54% in April. Our company asked us to put up our direct debit by 110%. We refused and said we would only put it up the 54% and would revisit in October when it goes up again and when we know by how much. They agreed to this with no argument. Martin Lewis said to do this on his programme as the utility companies are just filling their own coffers, which has been proved by the news today.

ILikeHotWaterBottles · 28/07/2022 15:34

Naunet · 28/07/2022 08:24

When people die this winter because they can’t afford heating, the blood will be on their hands and we shouldn’t let the forget it.

You're kidding yourself if you think they care. They are out shopping for yachts and private jets. They don't care if others freeze or starve this winter or even now. It's of no concern to them. You could show them a starving baby and they wouldn't care

MsFrenchie · 28/07/2022 15:34

SeptimusWarrenSmith · 28/07/2022 15:26

Confusing the producers with the suppliers in this thread is the main problem

They're owned and run by the same people.

If you think they are separate independent business entities then it's you who has the problem.

The same people, eh? Who would that be then, and are all the different people who think they are shareholders just actors.

Wait, don’t tell me, the real owners are the Rothschilds, and other suspicious ethnic types?

SeptimusWarrenSmith · 28/07/2022 15:39

Energy companies have a supplier arm and a wholesaler arm. British Gas for eg - the supplier part is British Gas, the wholesaler part is centrica. They're subsidiary businesses operating under the same concern. They all do it. So one part of the business buys the fuel and sells it on to the other part of the business which supplies it to consumers.

rumplestiltskinp · 28/07/2022 16:26

My dad was being charged for five accounts with five different account numbers. No one could explain why, the ombudsman works with energy companies. They took 2 grand from him before he even noticed, and he never even got it back.

How many times hast his happened and how many never notice?

amicissimma · 28/07/2022 16:53

What do people think companies do with their profits? Hide them under the mattress?

If their staff, senior and/or junior get pay rises and bonuses, those are generally well publicised. If senior staff given large sums it's generally because they are thought to be doing a good job and to try to stop them going off and doing a good job elsewhere, maybe at the competition. Perhaps people think that junior staff who work for an energy company should do so for a pittance?

Some of it goes to shareholders. I understand that many MNers think they are nasty, grasping rich people, but mainly they are pension and insurance companies, holding shares for their customers. Shareholding is a method of people getting together to lend money to companies. I wonder how many MNers would be willing to lend their money, with the ever-present risk of losing it all, and not getting any return on it. Just because you don't have savings now, it doesn't mean you won't at some point in the future, and putting them under the mattress results in loss due to inflation. No shareholders would mean companies couldn't really operate as they would only have their day-to-day, varying income to use to do their business, including paying staff. Some shares are owned directly, as a type of savings, maybe instead of a pension, or within ISAs, again, as savings. Dividends on the FTSE 100 have averaged about 3.7% recently, which sounds good against bank interest rates but is dreadful when you consider that anyone who invested/saved in Centrica shares 10 years now has about 27% of what they paid for them. Ie if they saved £100 they now have £27. That's quite a loss for a 3.7% dividend.

Some of the profits go back into the business of the company. Suppliers have to provide and maintain the infrastructure and pay people to do it. They will be quite skilled people so, even if you think they shouldn't earn much to keep your bills down, the employer probably disagrees. For exploration the costs are high. We need to invest now in finding and extracting the gas, oil, and possibly coal that we'll need in 40 years time. As people 40 years ago paid for the exploration for what we are using now, is it reasonable to refuse to pay for the next generation's energy. Energy companies are also investing heavily in 'green' technologies, which aren't very cost efficient at the moment, but are hoped to be in the future. They won't be developed unless money is spent doing so.

lemmein · 28/07/2022 22:26

amicissimma · 28/07/2022 16:53

What do people think companies do with their profits? Hide them under the mattress?

If their staff, senior and/or junior get pay rises and bonuses, those are generally well publicised. If senior staff given large sums it's generally because they are thought to be doing a good job and to try to stop them going off and doing a good job elsewhere, maybe at the competition. Perhaps people think that junior staff who work for an energy company should do so for a pittance?

Some of it goes to shareholders. I understand that many MNers think they are nasty, grasping rich people, but mainly they are pension and insurance companies, holding shares for their customers. Shareholding is a method of people getting together to lend money to companies. I wonder how many MNers would be willing to lend their money, with the ever-present risk of losing it all, and not getting any return on it. Just because you don't have savings now, it doesn't mean you won't at some point in the future, and putting them under the mattress results in loss due to inflation. No shareholders would mean companies couldn't really operate as they would only have their day-to-day, varying income to use to do their business, including paying staff. Some shares are owned directly, as a type of savings, maybe instead of a pension, or within ISAs, again, as savings. Dividends on the FTSE 100 have averaged about 3.7% recently, which sounds good against bank interest rates but is dreadful when you consider that anyone who invested/saved in Centrica shares 10 years now has about 27% of what they paid for them. Ie if they saved £100 they now have £27. That's quite a loss for a 3.7% dividend.

Some of the profits go back into the business of the company. Suppliers have to provide and maintain the infrastructure and pay people to do it. They will be quite skilled people so, even if you think they shouldn't earn much to keep your bills down, the employer probably disagrees. For exploration the costs are high. We need to invest now in finding and extracting the gas, oil, and possibly coal that we'll need in 40 years time. As people 40 years ago paid for the exploration for what we are using now, is it reasonable to refuse to pay for the next generation's energy. Energy companies are also investing heavily in 'green' technologies, which aren't very cost efficient at the moment, but are hoped to be in the future. They won't be developed unless money is spent doing so.

Aren't they all expenses though (apart from shareholder %) so will have already been deducted before totting up the profits?

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