Centrica, owner of British Gas, said on Thursday its energy trading arm will deliver lower-than-expected profit in 2026 and that it has paused its share buyback programme, sending its shares down 8%.
The company forecast core profit of about 250 million pounds at its Optimisation trading unit in 2026, below its previous guidance of 300 million to 400 million pounds, citing unfavourable weather and tougher market conditions.
Centrica reported a 39% drop in annual profit but posted adjusted core earnings of 1.42 billion pounds for 2025, slightly ahead of market expectations.
It said it would hold operating costs flat through 2030 and deliver 500 million pounds in underlying savings, though its transformation programme will cost around 600 million pounds to implement.
Analysts at JPMorgan said the weaker trading outlook and restructuring costs could trigger near-term earnings downgrades.
Chief Executive Chris O’Shea said pausing the buyback would allow the group to prioritise investment in long-term growth projects.
He pointed to developments including Sizewell C, Grain LNG and the company’s Meter Asset Provider business as foundations for more stable earnings.
Centrica is targeting core profit of 1.7 billion pounds by 2028 and 2 billion pounds by 2030, supported in part by potential nuclear life extensions pending approval.
Its Rough gas storage site is expected to break even in 2026 after operations were paused last year due to weak seasonal price spreads, while the company awaits the outcome of a UK government consultation that could reshape the gas storage business model.