British Gas owner Centrica has reported operating profits of £1.44 billion for 2006.
The figure, which was down 5% on the previous year, included profits of £95m from the company's residential energy arm after the division made a loss in the first half of the year.
British Gas recently announced a fall in tariffs after losing one million customers in 2006 due to rising energy bills. British Gas had just over 16 million customers at the end of the period, with its share of the UK gas market now below 50%.
Turnover for the division was up 18% to £7.1 billion due to price increases in March and September, which were imposed in order to cover a surge of 42% in wholesale gas prices over the course of the year.
But margins improved towards the end of 2006 as industry costs eased and the price hikes filtered through the business. The residential arm made record losses of £143m in the first half of the year, but achieved profits of £238m in the second half.
Today's results show that the company's upstream operation - Centrica Energy - faced a challenging year after operating profits fell 24% to £686m. Lower gas production levels were blamed for the downturn, following an extended summer maintenance period at its Morecambe Bay gas field.
