British Gas owner plans to axe 5,000 jobs in restructure

SHAREWATCH

THE owner of British Gas has said it will cut 5,000 jobs this year as the company restructures following the impact of coronavirus.

Centrica said it would strip out three layers of management to slimline the business and cut down on bureaucracy.

British Gas has a call centre on Callaghan Square in Cardiff, which houses around 500 employees.

The group has specified that around half of the job losses are set to be among the company’s leadership, management and corporate staff. This includes half of the 40-strong senior leadership team who will step down by the end of August.

However, most of the restructuring is expected to happen in the second half of this year.

The need to restructure has in part been accelerated by the impact of coronavirus.

In a statement, chief executive Chris O’Shea said: “Since becoming chief executive almost three months

AEROSPACE & DEFENCE

AvonRbbr ..................................... £291/2 BAE Systems ................................. 516 5/8 Chemring ....................................... 232 1/2 Meggitt ........................................... 292 1/2 Rolls-Royce .................................... 321 5/8 Senior ................................................ 77 1/2

AIM

600 Group .......................................... 9 3/4 Highland Gold Mining .............. 237 Johnson Service Grp ................. 115 London Security .......................... £21 M”S Intl ........................................... 130 Nichols ......................................... 1300 Scapa Grp ...................................... 109 3/8 Youngs ......................................... 1220

BANKS

Barclays .......................................... 115 HSBC Hldgs ................................... 376 1/4 Lloyds Banking Gp ....................... 32 Ryl Scotland .................................. 117 1/2 Standard Chartered ................... 414

BEVERAGES

Barr (AG) ......................................... 466 1/2 Diageo ............................................ £27 3/4

CHEMICALS

Croda International .................... £50 1/2 Elementis 98 ................................... 68 JohnsnMat ................................... £203/8

CONSTRUCTION & MATERIALS

BalfourBeatty .............................. 259 C”R”H .............................................. £26 5/8 Costain .............................................. 76 Marshalls ........................................ 627

ELECTRICITY

DraxGp .......................................... 2133/4 SSE ................................................ 1212 1/2

ELECTRONIC & ELECTRICAL EQUIPMENT

Morgan Advanced ...................... 235 Ox Instmts .................................. 1400 Volex ................................................ 142 1/2 -1/2 -12 3/8 -6 1/2 -18 3/8 -31 3/4 -10

-1/4 +4 3/4 -2

-25 -7 1/4 -27 1/2

-9 -24 1/4 -3 -11 1/4 -36

-17 -1

-1 1/8 -5 3/8 -1 1/2

-2 5/8 -1 3/8 -8 1/4

-23

-9 1/4 -43 -5 +12 -7 1/2 ago, I’ve focused on navigating the company through the Covid-19 crisis and identifying what needs to change in Centrica.

“We’ve learnt through the crisis that we can be agile and responsive in the most difficult conditions and put our customers at the heart of our decision making.”

He added: “I truly regret that these difficult decisions will have to be made and understand the impact on the colleagues who will leave us.

“However, the changes we are proposing to make are designed to arrest our decline, allow us to focus on our customers and create a sustainable company.”

Although it is still by far the biggest energy supplier in Britain, British Gas has been squeezed by increased competition in recent years.

The company has lost around half its earnings in the past decade, as

EQUITY INVESTMENT INSTRUMENTS

Aberdeen DI & G Trust ................ 88 5/8 Alliance Trust ................................ 761 Dunedin Inv .................................. 254 Edin Invst ....................................... 465 Electra Private Equity ................ 216 F&C Investment Trust ................ 667 Henderson Smllr Cos ................. 770 North American Inc ................... 240 Scot Am .......................................... 411 Scottish Mortgage ..................... 726 Witan ............................................... 181 1/4

FIXED LINE TELECOMMUNICATIONS

BT Grp ............................................. 114 Talktalk Telecom ............................ 95 1/8

FOOD & DRUG RETAILERS

Morrison (WM) ............................ 185 7/8 Sainsbury ....................................... 197 5/8 Tesco ............................................... 227 3/4

FOOD PRODUCERS

AB Food ....................................... 1907 1/2 Carrs Group ................................... 110 REA Hldgs ........................................ 66 1/2 TateLyle ......................................... 667 Unilever .......................................... £43 3/8

GAS, WATER & MULTIUTILITIES

Centrica ............................................ 40 1/8 National Grid ................................ 905 3/4 Pennon Grp ................................ 1093 1/2 Severn ............................................. £23 3/4 United Utils ................................... 891 3/4

GENERAL FINANCIAL

3i Group ......................................... 820 3/4 Close Bros ................................... 1077 London StockExch ...................... £81 Man Group .................................... 134 3/8 Provident Financial .................... 195 1/4 Schroders ...................................... £29 1/8 Schroders NV ................................ £22 3/4

GENERAL INDUSTRIALS

Smith (DS) ..................................... 314 Smiths Grp ................................. 1263

-3 -22 -3 1/2 -18 +5 -19 -23 -10

-7 -20 -3 3/4 -6 1/2 -4 1/8

-2 3/8 -2 1/2

+3/4

-90 1/2 +2 1/2 +4 -11 3/8 -3/8

-1 3/4 -27 5/8 -38 1/2

-1 1/2 -27 3/8

-51 3/4 -47 +1/4 -2 3/4 -10 1/4 -1 7/8 -1/2

-23 -70 smaller suppliers chipped away at its market share, from a quarter in 2013 to 19% today.

The rise of smaller suppliers was capped off last year when Ovo Energy, which was only founded in 2009, bought SSE.

Last month Ovo announced that it would axe 2,600 roles at the combined business, as the coronavirus pandemic speeded up its restructuring plans.

Much the same has happened at Centrica, where the need to restructure and find a new path forward has been accelerated by the crisis.

The GMB union vowed to fight the cuts, with spokesman Justin Bowden saying: “A combination of the (energy price) cap and too little, too late management decisions have left a once proud brand crippled and weak.

“Slashing thousands more jobs is not the answer. You cannot just cut your way out of a crisis.

“GMB will fight for every single job.”

GENERAL RETAILERS

Dixons Carphone .......................... 91 Inchcape ........................................ 4953/4 Kingfisher ...................................... 195 3/8 M & S ............................................... 103 Mothercare ........................................ 8 1/8 Next ................................................. £49 1/4 WH Smith ................................... 1131

HEALTH CARE EQUIPMENT & SERVICES

Smith Nph .................................. 1609

HOUSEHOLD GOODS

Barratt Devel ................................ 518 3/4 Bellway ........................................... £26 1/8 Persimmon .................................... £23 Reckitt Benckiser ........................ £69 3/8 Taylor Wimpey ............................. 148 3/4

INDUSTRIAL ENGINEERING

I”M”I ................................................. 886 Molins ............................................. 158 Renold ................................................. 7 Spirax-Sarco .................................. £96 3/4 Weir Grp ......................................... 983 3/4

INDUSTRIAL METALS

Ferrexpo ......................................... 189 1/4

INDUSTRIAL TRANSPORTATION

Signature Avi ................................ 222 1/8

LIFE INSURANCE

Aviva ................................................ 275 1/2 Lgl & Gen ....................................... 224 Prudential ................................... 1132 Standard Life Aberdeen ........... 250 1/4

MEDIA

DailyMail&GenTst ................... 704 IT V ...................................................... 76 Pearson ........................................... 513 Reach ................................................ 84 5/8 RELX .............................................. 1836 STV Group ..................................... 252 1/2 WPP ................................................. 6253/4 -3 -30 1/4 -9 1/4 -9 1/8 +1/4 -3 1/8 -95 -49

-19 3/4 -1 3/8 -1 1/8 -1/4 -7 5/8

-50

-1/4 -3 -51 1/4

-7 3/4 -14 1/4

-12 3/8 -13 -68 -14 1/2

-12 -7 3/4 -21 3/4 -4 3/4 -45 +3 -50 1/4

MINING

Anglo American ....................... 1777 Antofagasta .................................. 855 BHP Group ................................. 1649 1/4 Fresnillo .......................................... 776 1/4 Kaz Minerals ................................. 436 3/4 Rio Tinto ......................................... £45

MOBILE TELECOMMUNICATIONS

Vodafone Group ......................... 126

NONLIFE INSURANCE

Admiral Grp .................................. £22 3/4 Marsh McL ..................................... £84 RSA Ins Gp ..................................... 401 1/2

OIL & GAS PRODUCERS

BP ..................................................... 320 7/8 Cairn Energy ................................. 120 1/8 Premier Oil ...................................... 42 3/8 Royal Dutch Shell A ................. 1328 5/8 Royal Dutch Shell B ................. 1279 3/4 Total ................................................. £31 1/4 Tullow Oil ......................................... 32

OIL EQUIPMENT & SERVICES

Petrofac .......................................... 197 Wood Gp(J) ................................... 195 1/2

PERSONAL GOODS

Burberry Gp ............................... 1556 PZ Cussons .................................... 180

PHARMACEUTICALS & BIOTECHNOLOGY

Astrazeneca .................................. £823/4 GlaxoSmithKline ...................... 1615 3/4

REAL ESTATE

Brit Land ......................................... 401 3/4 Hamrsn ........................................... 112 Intu Properties .................................. 7 Land Securities ............................ 592 5/8 SEGRO ............................................. 853 1/4

SOFTWARE & COMPUTER SERVICES

Computacenter ........................ 1584 Sage Group ................................... 652 -91 1/4 -35 3/8 -69 5/8 +8 3/4 -26 1/4

-7/8 -10 3/8

-3/8 -3 1/8 -16

-23 1/2 -8 3/4 -4 5/8 -84 3/8 -76 5/8

-2 -4 5/8

-16 1/8 -23 1/8

-118 -1 1/4 -34 3/4

-16 1/4 -5 1/2 -3/8 -33 5/8 -1 3/8

-44 -28

SUPPORT SERVICES

Bunzl ............................................ 1881 Capita ................................................ 39 3/4 Connect Group .............................. 13 De La Rue ....................................... 116 1/4 Elctro Com ..................................... 637 1/2 Electrocomp ................................. 637 1/2 Experian ......................................... £27 G4S ................................................... 102 3/4 Hays ................................................. 120 3/4 Homeserve ................................. 1236 Menzies J ....................................... 120 3/8 Redde Northgate ........................ 250 Rentokil .......................................... 489 1/4 Travis & P ..................................... 1070

TECHNOLOGY HARDWARE & EQUIPMENT

IBM ................................................... £96 5/8 Spirent Comms ............................ 231

TOBACCO

Br Am Tob ...................................... £30 Imperial Brands ........................ 1495

TRAVEL & LEISURE

Carnival ....................................... 1190 Compass Grp ............................. 1161 easyJet ............................................ 760 1/4 FirstGroup ....................................... 53 1/8 Go-Ahead Gp ............................ 1000 Intercontl Htls .............................. £37 7/8 Intl Cons Airl ................................. 262 7/8 Marston’s .......................................... 64 Mitchells & Butlers ...................... 201 Natl Express .................................. 227 Rank Org ........................................ 159 Restaurant Grp .............................. 64 1/2 Ryanair ............................................ 997 Stagecoach Group ....................... 68 1/8 Whitbread ..................................... £23 William Hill .................................... 134 7/8

INDEX FTSE 100 ......................... 6076.70 FTSE 250 ....................... 16973.67

-97 1/2 -4 1/4 -2 -7 3/4 -33 -33 -3/4 -8 7/8 -6 1/4 -35 -17

+1 1/8 -70 -6 1/8 -5

-1 1/4 -44 1/2

-164 1/2 -72 -58 1/4 -5 7/8 -100 -2 3/4 -25 3/8 -7 1/8 -22 1/2 -18 -9 -5 1/2 -75 1/8 -5 5/8 -2 -9 1/8

-252.43 -631.79