
Centrica profit drops nearly 40% as gas market weakens; buybacks halted
Centrica trims returns as gas prices and trading headwinds bite
Immediate result: Centrica delivered £1.42 billion in EBITDA for fiscal 2025 while reporting an almost 40% fall in full-year profit. Management linked the shortfall to a weaker commodity backdrop and volatile trading conditions that constrained earnings.
Operational response: The company has placed its share buyback programme on hold and signalled a more defensive capital approach for the near term. That choice preserves cash but reduces shareholder returns in the current cycle.
Trading environment: Lower gas benchmarks, combined with ongoing geopolitical uncertainty, reduced margins across Centrica’s portfolio — from retail supply to wholesale trading — and made price discovery harder for the group’s trading arm.
Financial snapshot: EBITDA of £1.42bn converts to roughly $1.9bn, underscoring the scale of earnings still being produced despite the contraction. The profit decline was the headline metric that triggered market attention.
Strategic implications: Pausing buybacks increases flexibility to cover working capital swings and protect the balance sheet if gas prices remain depressed. It also signals management expects continued near-term market volatility rather than a quick rebound.
- Liquidity preserved through halted share repurchases.
- EBITDA remains positive but reduced versus prior-year levels.
- Commodity and trading volatility identified as primary earnings drivers.
Market reaction and next steps: Investors will watch guidance, hedging disclosures, and trading performance for signs of stabilization; any extension of weak gas pricing would keep pressure on margins. Management faces a trade-off between restarting buybacks and shoring up capital against further downside.
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