#1centrica Centrica plc Interim Results for the period ended 30 June 2021 G#2Disclaimer This presentation does not constitute an invitation to underwrite, subscribe for, or otherwise acquire or dispose of any Centrica shares or other securities. centrica This presentation contains certain forward-looking statements with respect to the financial condition, results, operations and businesses of Centrica plc. These statements and forecasts involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied. by these forward-looking statements and forecasts. Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser. 2 Interim Results 2021#3Chris O'Shea Group Chief Executive tis centrica#4Turnaround of Centrica continues ● • First half financial performance overall in line with expectations - Adjusted operating profit and EPS broadly flat vs 2020 - Continuing robust free cash flow generation - Net debt down to <£100m ● Major transformation of Centrica continues - - Focus remains on fixing the basics 4 centrica Customer numbers down 2% - Competitive intensity in British Gas Energy Customer service levels impacted by Covid-19 and industrial action in British Gas Services Interim Results 2021#5Kate Ringrose Chief Financial Officer GONSK British Gas centrica#6Group earnings Period ended 30 June (fm) From continuing operations: Adjusted revenue Adjusted gross margin Adjusted operating costs Adjusted operating profit¹ Net finance cost Group effective tax rate Adjusted earnings Adjusted EPS- continuing Adjusted EPS- discontinued Adjusted EPS- total Exceptional items and certain remeasurements after tax & MI Statutory earnings Statutory EPS 2020 6 7,726 1,185 (919) 264 (124) 41% 90 1.6p 0.9p 2.5p (340) (193) (3.3p) 2021 8,154 1,154 (856) 262 (96) 35% 98 1.7p 0.0p 1.7p 1,253 1,351 23.2p A 428 (31) 63 (2) 28 (6ppt) 8 0.1p (0.9p) (0.8p) 1,593 1,544 26.5p 1. Includes share of losses from JVs and associates, net of interest and taxation, of £2m in H1 2020 and £36m in H1 2021. Interim Results 2021 centrica Bod 1}}}]]#7Operating profit ADJUSTED OPERATING PROFIT Period ended 30 June (£m) British Gas Services & Solutions British Gas Energy Energy Marketing & Trading Core EM&T activities Legacy gas contract Centrica Business Solutions Bord Gáis Energy Upstream Total Continuing Operations Total Discontinued Operations Total Centrica 2020 94 78 111 138 (27) (67) 29 19 264 79 343 2021 60 172 (40) 17 (57) (24) 19 75 262 0 262 A (34) 94 (151) (121) (30) 43 (10) 56 (2) (79) (81) centrica EXCEPTIONAL ITEMS AND STATUTORY PROFIT Period ended 30 June (fm) Adjusted operating profit from cont. ops Pre-tax exceptional items from cont. ops E&P asset write-backs Restructuring provision release Pre-tax net re-measurements from cont. ops Statutory operating profit from cont. ops Profit on disposal of discontinued ops Statutory operating profit The above adjusted figures are before exceptional items and certain re-measurements. Adjusted operating profit includes share of joint ventures and associates after interest and taxation. A reconciliation of adjusted operating profit is provided in the Group Financial Review in the Interim Results announcement. 7 Interim Results 2021 2021 262 373 366 7 368 1,003 597 1,600#8Adjusted operating profit drivers £264m H1 2020 Covid-19 and Downstream commodity and weather industrial action (£58m) H1 2020 – (£29m) Impacts: £139m Mitigations £110m H1 2021 - (£87m) Impacts: £107m Mitigations £20m £59m Whitegate CCGT outage (£28m) Energy services and supply £85m British Gas S&S: £18m British Gas Energy: £27m CBS: £25m Bord Gais Energy: £15m Energy Marketing & Trading (£118m) Core underlying: (£88m) Legacy gas contract: (£30m) Upstream £58m Spirit: £71m CSL: £11m Nuclear: (£24m) The above adjusted figures are before exceptional items and certain re-measurements. Adjusted operating profit includes share of joint ventures and associates after interest and taxation. A reconciliation of adjusted operating profit is provided in the Group Financial Review in the Interim Results announcement. 8 Interim Results 2021 centrica £262m H1 2021#9Energy Marketing & Trading gross margin by activity £m Full year 300 250 200 150 100 50 (50) (100) FY 2017 FY 2018 9 Interim Results 2021 FY 2019 Gas and power trading / Route-to-market LNG FY 2020 Legacy gas contract First half H1 2020 centrica H1 2021#10Robust cash flow generation and lower net debt Period ended 30 June (fm) EBITDA from continuing operations Tax Dividends received Working capital / other Net investment Capex plus small acquisitions Divestments Exceptional cashflows Free cash flow from continuing ops Free cash flow from discontinued ops Total free cash flow 2020 750 (43) 23 (1) (175) (285) 110 (50) 504 245 749 2021 682 41 1 (3) (149) (187) 38 (48) 524 (68) 1. 2020 divestments largely Kings Lynn CCGT, 2021 largely former British Gas headquarters. 10 Interim Results 2021 20 2,582 3,106 2,357 Period ended 30 June (fm) Free cash flow from continuing operations Interest Dividends Centrica shareholders Dividends - Spirit minority shareholders Pension deficit payment Movements in margin cash Other financing cash flows affecting net debt Adjusted cash flow affecting net debt cont. Adjusted cash flow affecting net debt - discont. Adjusted cash flow affecting net debt - total Opening net debt2 (as at 1 January) Adjusted cash flow movements Non cash movements Closing net debt 2. Net debt includes margin cash balances. centrica 2020 504 (80) (76) 56 (1) 403 254 657 (3,507) 657 (215) (3,065) 2021 524 (109) (243) 129 1 302 2,582 2,884 (2,998) 2,884 21 (93)#11Balance sheet and pension deficit focus continues Balance sheet • Net debt significantly down to £0.1bn • Continue to target maintaining investment grade credit ratings Redeemed €750m hybrid at first call date in April 2021 ● Pension deficit IAS 19 net pension deficit of £130m vs £601m at 31 Dec 2020 ● ● Triennial pensions valuation discussions ongoing - Increase in real gilt rates since 31 Dec 2020 - 15 month deadline from 31 Mar 2021 to agree valuation and contributions 1. On a pure roll-forward basis from 31 March 2018, using the same methodology and consequent assumptions, the scheme funding (Technical Provisions) deficit would be in the region of £1.5bn as at 30 June 2021. The 31 March 2021 triennial review is underway and the valuation methodology and assumptions may differ from those previously used. Interim Results 2021 11 Debt maturity profile (£m) Hybrid bond (first call date) Bonds 800 600 400 200 0 2022 3.0 2.5 2.0 1.5 1.0 0.5 2027 Pension deficit (£bn) 2032 IAS 19 net deficit Technical deficit¹ centrica 2037 1 2042 Jun 2019 Dec 2019 Jun 2020 Dec 2020 Jun 2021#12Summary and outlook • Higher commodity prices beginning to benefit Upstream ● H1 financial performance in line with last year Full year modelling assumptions from Prelims still valid - Whitegate CCGT outage (up to £40m) - Higher ECO costs (~-£80m) Restructuring benefits including corporate cost removal (>£100m) ● E&P production volumes down 15%-20% and lower nuclear volumes year 2021 operating loss from legacy gas contract expected to be ~£100m Strong focus on free cash flow continues Full 12 Interim Results 2021 centrica#13Chris O'Shea Group Chief Executive 0 British Gas WORCESTER centrica CEREET#14Progress made on Turnaround Colleagues • New modernised terms and conditions in place for UK colleagues • Industrial dispute concluded with new collective agreements • Started recruitment programme to build engineer capacity Customers • New business unit structure and reduced layers embedded allowing more focus on customers Separation of UK energy supply and UK services and solutions into more focussed businesses Cash ● 14 centrica Pursuing alternative Spirit Energy sale options to maximise value of assets and de-risk liabilities Further rationalisation of non-core assets ~ £50m proceeds from divestments of Peterborough site, lo-Tahoe and British Gas HQ Interim Results 2021#15Modernising British Gas Energy Serving residential and small business customers • British Gas Energy cost to serve down 7% over H1 2021 250k customers on flexible, lower cost 'software as a service' platform • Modern and agile customer-focused ways of working • Reduced time to bring propositions to market • Controlled approach to migration ● ● 15 Interim Results 2021 centrica 1 British Gas Bosed#16Modernising British Gas Services Largest energy services provider in the UK with 7,500 engineers and technicians Change essential to improve competitiveness and provide a better customer experience • Committed to direct labour model ● ● Q1 2021 impacted by Covid-19 and industrial action - Signs of recovery in Q2 • Improvement plans in place for H2 2021 - Continue reset of relationship with colleagues - Drive further recovery in customer service levels - Improve customer retention • Sustainable platform from which to deliver growth 16 Interim Results 2021 Engineer productivity¹ 8 7 5 4 Engineer NPS 80 70 60 50 2020 Jan Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 1. Service and Repair jobs completed per day. Apr 2021 Jul centrica Oct 2019 2021 Jan Apr Jun#17Net zero a significant opportunity for Centrical ● ● Largest services field force in the UK Creating new, highly skilled and well paid jobs - - Recruiting 1,000 apprentices across 2021 and 2022 Training academies a competitive advantage Expanding range of customer propositions for homes and businesses EV charging, heat pumps, home energy management • Nuclear a source of zero carbon power generation Reviewing option to repurpose Rough for hydrogen storage Adding to our 11GW of renewables route-to-market capacity Committed to achieving net zero by 2045 ● 17 Interim Results 2021 centrica a Plug in baby tal home EV cherging#18Creating a more sustainable and profitable company Major transformation of Centrica continues Simplifying the business to add long-term shareholder value Continuing focus on fixing the basics to benefit Centrica now and in the future • Improving colleague engagement critical - Using Covid-19 learnings - Embedding a flexible approach to working ● Capital Markets Event to be held on 16 November 2021 to provide more detail on longer-term strategy and financial framework 18 Interim Results 2021 centrica#19Appendix C British Gas centrica BREAD COSU#20H1 2020 adjusted operating profit Small Business Energy¹ & Business Services into British Gas Period ended 30 June (£m) Previous segments UK Home - energy UK Home services Centrica Home Solutions Total UKHS and CHS Ireland Energy Marketing & Trading UK Business Centrica Business Solutions Total UKB and CBS Upstream North America Home North America Business Total North America Group adjusted operating profit Figures may not add down due to rounding. 1. New segmentation changes since Prelims 2020 20 Interim Results 2021 2020 as reported 93 136 (29) 107 30 115 (39) (34) (73) 19 99 (47) 52 343 (6) (4) (4) 10 10 Metering¹ 5 (5) (5) Re-allocated corporate costs (14) (4) (4) (1) (4) (4) (4) 27 2020 restated 78 94 29 111 (67) 19 79 343 centrica New segments British Gas Energy British Gas Services & Solutions Bord Gáis Energy Energy Marketing & Trading Centrica Business Solutions Upstream Discontinued Operations#21Revenue Period ended 30 June (£m) Continuing Operations British Gas Services and Solutions British Gas Energy 736 3,710 1,482 802 416 Upstream 982 Group Revenue included in business performance 8,128 Discontinued Operations Direct Energy Gross revenue Inter-group revenue Total Centrica Energy Marketing & Trading Centrica Business Solutions Bord Gáis Energy 2020¹ 1. 2020 restated to reflect the new operating structure of the Group. 21 Interim Results 2021 4,795 12,923 (402) 12,521 2021 722 3,840 1,991 871 484 838 8,746 8,746 (592) 8,154 A (2%) 4% 34% 9% 16% (15%) 8% nm (32%) 47% (35%) centrica#22Adjusted gross margin Period ended 30 June (£m) Continuing Operations British Gas Services and Solutions British Gas Energy Energy Marketing & Trading Centrica Business Solutions Bord Gáis Energy ....... Upstream Adjusted gross margin from continuing operations Discontinued Operations Direct Energy Total Group adjusted gross margin The above adjusted figures are before exceptional items and certain re-measurements. 1. 2020 restated to reflect the new operating structure of the Group. 22 Interim Results 2021 2020¹ 325 497 148 36 83 96 1,185 396 1,581 2021 266 530 26 75 69 188 1,154 1,154 (18%) 7% (82%) 108% (17%) 96% (3%) ........... nm (27%) centrica#23EBITDA Period ended 30 June (fm) Continuing Operations British Gas Services and Solutions British Gas Energy Energy Marketing & Trading Centrica Business Solutions Bord Gáis Energy Upstream Other EBITDA Discontinued Operations Direct Energy Total Group EBITDA The above adjusted figures are before exceptional items and certain re-measurements. 1. 2020 restated to reflect the new operating structure of the Group. 23 Interim Results 2021 2020¹ 130 125 130 (42) 38 320 49 750 119 869 2021 82 220 (14) 1 27 336 30 682 682 A (37%) 76% nm nm (29%) 5% (39%) (9%) nm (22%) centrica#24Adjusted operating profit Period ended 30 June (fm) Continuing Operations British Gas Services and Solutions British Gas Energy Residential energy supply Business energy supply Energy Marketing & Trading Core EM&T activities Legacy gas contract Centrica Business Solutions Energy supply Solutions Bord Gáis Energy Upstream Spirit CSL Nuclear Adjusted operating profit 24 Interim Results 2021 2020¹ 94 78 83 (6) 111 138 (27) (67) (33) (34) 29 19 33 1 (16) 264 2021 60 172 158 13 (40) 17 (57) (24) 3 (27) 19 75 104 9 (38) 262 A (36%) 121% 90% nm nm (88%) 111% (64%) nm (21%) (34%) 295% 215% 800% 138% (1%) centrica Figures may not add down due to rounding. The above adjusted figures are before exceptional items and certain re- measurements. Adjusted operating profit includes share of joint ventures and associates after interest and taxation. A reconciliation of adjusted operating profit is provided in the Group Financial Review in the Interim Results announcement. 1. Refer to slide 20 in appendix for a reconciliation of 2020 to prior segmentation.#25Net investment Period ended 30 June (fm) Continuing Operations British Gas Services and Solutions British Gas Energy Energy Marketing & Trading Centrica Business Solutions Bord Gais Energy ......... Upstream Other² Net Investment Net Disposals³ Continuing Net Investment Discontinued Net Investment Total Group Net Investment 2020¹ (10) (21) (4) (15) (10) (202) (23) (285) 110 (175) (13) (188) 2021 (16) (13) (3) (15) (13) (122) (187) ************* 38 (149) 2,582 2,433 1. 2020 restated to reflect the new operating structure of the Group. 2. Other includes Corporate Functions. 3. 2020 divestment includes Kings Lynn CCGT, 2021 includes sale of former British Gas headquarters See pages 65 to 68 in the Interim Results announcement for an explanation of the use of adjusted performance measures. 25 Interim Results 2021 centrica#26Free cash flow Period ended 30 June (£m) Continuing Operations British Gas Services and Solutions British Gas Energy Energy Marketing & Trading Centrica Business Solutions Bord Gáis Energy Upstream Other Segmental free cash flow Discontinued Operations Direct Energy Group total free cash flow excluding tax Taxes paid from continuing operations Taxes paid from discontinuing operations Total Group adjusted free cash flow Less discontinuing operations free cash flow (including tax) Free cash flow from continuing operations 26 Interim Results 2021 2020¹ 80 (37) 211 93 26 150 24 547 251 798 (43) (6) 749 (245) 504 2021 46 (58) 121 72 (7) 255 54 483 2,582 3,065 41 3,106 (2,582) 524 A (43%) 57% (43%) (23%) nm 70% 125% (12%) ....... 929% 284% nm nm 315% 954% 4% centrica A reconciliation of free cash flow is provided in the Group Financial Review in the Interim Results announcement. 1. 2020 restated to reflect the new operating structure of the Group.#27Upstream - Exploration & Production E&P Period ended 30 June (£m) Gas and liquids realisations Adjusted operating profit Free cash flow¹ Achieved gas sales price (p/therm) H1 2020 H1 2021 35.1 45.7 2020¹ 667 34 141 2021 575 113 266 A (14%) H1 2020 H1 2021 232% 89% Achieved liquids sales price (£/boe) 34.4 38.6 Upstream production (mmboe) H1 2020 H1 2021 centrica Spirit Energy CSL H1 2020 12.3 H1 2021 16.4 23.7 17.1 1.4 Lifting & other cash production costs (£/boe) 21.0 1.7 20.4 1. Segmental free cash flow, as per note 4(f) of the Interim Results announcement, excludes tax. The above adjusted figures are before exceptional items and certain re-measurements. A reconciliation of adjusted operating profit and free cash flow is provided in the Group Financial Review and other adjusted performance measures are explained on pages 65 to 68 in the Interim Results announcement. 27 Interim Results 2021#28Upstream - Nuclear NUCLEAR Period ended 30 June (£m) Adjusted operating profit (£) Nuclear power generated (GWh) Achieved power price (£/MWh) Achieved power price (£/MWh) H1 2020 H1 2021 46.5 53.0 2020 (16) 4,537 53.0 2021 (38) 4,171 (8%) 46.5 (12%) A 138% Power Generated Total (GWh) H1 2020 H1 2021 4,171 4,537 The above adjusted figures are before exceptional items and certain re-measurements. Adjusted operating profit includes share of joint ventures and associates after interest and taxation. A reconciliation of adjusted operating profit is provided in the Group Financial Review in the Interim Results announcement. 28 Interim Results 2021 centrica#29Market commodity prices Average Brent oil prices ($/bbl) $42 2020 $67 $65 2021 2022 as at as at 20 Jul 21 20 Jul 21 Average UK NBP gas prices (p/th) 25p 2020 73p 2021 as at 20 Jul 21 66p 2022 as at 20 Jul 21 Average UK baseload power prices (£/MWh) Brent oil, UK NBP gas and UK baseload power prices are month ahead prices as at 20 July 2021. Prices are calendar year averages of historic and forward prices. 29 Interim Results 2021 £37 2020 £79 centrica 2021 as at 20 Jul 21 £72 2022 as at 20 Jul 21#30NBP spot price & forward curve evolutions p/Th 100 80 60 40 20 0 Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22 Jul-22 Oct-22 Jan-23 Apr-23 Jul-23 Oct-23 30 Interim Results 2021 Day Ahead (Spot) FWD curve on 01-Jun-21 centrica FWD curve on 01-Jul-21 FWD curve on 04-Jan-21#31UK weather chart vs seasonal norms 31 15 10 LO 5 0 Interim Results 2021 M January February March April May June centrica#32CDP and TCFD CDP DISCLOSURE INSIGHT ACTION A LIST 2020 CLIMATE TCFD 32 Interim Results 2021 • CDP is a global non-profit that drives companies and governments to reduce their greenhouse gas emissions, safeguard water resources and protect forests. It was voted the number one climate research provider by investors. • CDP's annual environmental disclosure and scoring process is widely recognised as the gold standard of corporate environmental transparency, working with over 500 institutional investors with assets of US$106 trillion. • Centrica has retained the prestigious A rating in the Climate Change Submission. ● centrica 273 worldwide gained a place in the 'A List' of the over 9,500 companies (making up over 50% of global market cap) who disclosed under Climate in 2020. The 'A list' comprises the world's most pioneering companies leading on environmental transparency and performance. - Only 20 companies from UK achieved an A grade. Centrica is amongst the top 20 globally within our sector alongside Orsted, EDF, Engie and National Grid. - TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES The 'Taskforce on Climate-related Financial Disclosures' is an organisation with the goal of developing a set of voluntary climate-related financial risk disclosures whic can infor investors and other stakeholders about the risks companies face related to climate change. • We became signatories of the Task Force on Climate-related Financial Disclosures (TCFD) in Jan 2020, and are committed to progressively align with the recommendations and continuously improve our disclosure.