Energy companies profits at their highest level ever?

Published: 6th Sep 2017

In brief

Claim

Profit margins of the big six energy companies hit their highest ever level.

Conclusion

That’s correct if you look at the average. It was 4.5% in 2016, up from 1% in 2009 when these figures were first published. Looking at individual companies there is a lot of variation though.

“Last week the profit margins of big six energy companies hit their highest ever level.”

Jeremy Corbyn, 6 September 2017

That’s correct if you look at the average.

The average profit margin of the big six energy companies was 4.5% in 2016. That’s the highest since the measure began in 2009.

That’s looking at the profits before tax as a proportion of overall revenue from supplying domestic gas and electricity.

That average hides a lot of variation between companies though. NPower’s supply margin was -6.3%, whilst at the other end of the spectrum Centrica’s was 7.2%.

Looking at the companies individually only two had their highest ever profit margin in 2016 (E.ON and SSE).

This factcheck is part of a roundup of Prime Minister's Questions. Read the roundup.


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