British Gas parent Centrica have added fuel to the flames over record price hikes by announcing a £144.6 million dividend payout for its shareholders.
The 16% jump in the dividend came as the group posted better than expected half-year profits of £992 million - a day after hitting millions of customers with a record 35% jump in gas bills.
Chief executive Sam Laidlaw defended the dividend as a "purely mechanical" payout based on the company's strong performance during the previous year.
But the move comes as the average dual fuel customer's annual bills have gone up more than £400 to £1,317 since the start of the year, and sparked anger from consumer watchdogs.
Energywatch campaigns director Adam Scorer said households would be "staggered" at Centrica's profits, adding: "Customers will be outraged to learn that while they ponder how to make ends meet Centrica's shareholders are enjoying an increase in their dividends."
Centrica is paying a dividend of 3.9p a share on more than 3.7 billion shares in issue - 30% of last year's payout after its £1.95 billion profits in 2007. Mr Laidlaw said the group had to reflect shareholder interests as well as customers.
"This is a business that has got a million shareholders - a lot of pension funds and people have got their savings invested in British Gas shares and we have to look after them," he said.
The group's £992 million profits are 19% below last year after the group felt the impact of rising wholesale costs at British Gas, where profits fell 69% to £166 million.
The UK's biggest domestic energy supplier, which has 15.9 million customers, has also lifted electricity prices 9% alongide its mammoth rise in gas bills.
The group said the price increases were necessary to restore "reasonable profitability" to British Gas and invest in additional gas and power assets.
But while British Gas earnings were down more than two-thirds from last year's £533 million - when Centrica waited before passing on rapidly falling wholesale prices - the firm's production business saw a five-fold jump in profits.
Centrica's gas production and development operation benefited from this year's soaring gas prices to post operating profits of £638 million, compared with just £123 million during the previous year.
Centrica's operating profits for the first half of the year are more than £100 million ahead of the £880 million expected by City forecasts.
Despite the price hikes at British Gas, Centrica said it had made strides in improving the efficiency of the business in a trading environment "dominated by high wholesale energy prices".
By June this year complaints to consumer watchdog Energywatch had fallen by more than 90% from a peak in April last year when the company had problems with the introduction of a new billing system, the firm said.
The business also cut 8% of its staff over the period and is on track to make £60 million in cost savings, although yesterday's tariff increases will overshadow the results.
British Gas said it was left with no choice - despite the pressure on households struggling to cope with surging food, petrol and mortgage costs - because of increasing global demand, diminishing UK gas reserves and record oil prices pushed up its costs.
French-owned EDF Energy became the first major energy company to lift prices last Friday - 17% for electricity and 22% for gas - blaming record oil prices for the move.
And other rivals among the UK's "big six" are sure to follow EDF and Centrica after Scottish & Southern Energy last week said it was becoming "more difficult by the day" to resist hitting customers with higher bills.
