Pennon Group Plc - South West Water Accepts Final Determination

PENNON GROUP PLC

14 February 2020

SOUTH WEST WATER ACCEPTS FINAL DETERMINATION

As part of the Price Review 2019 (PR19) process, South West Water's Final Determination for the period 2020-2025 (K7) was published by Ofwat on 16 December 2019. After careful consideration, Pennon Group is announcing today that South West Water will not be applying for this to be referred to the Competition and Markets Authority (CMA).

Importantly for customers, by 2025 South West Water bills will be lower than they are today and lower than they were 15 years earlier. 

South West Water's Final Determination also includes;                  

  • a totex allowance of c.£2bn (wholesale and residential retail) - consistent with South West Water's Draft Determination in April 2019
  • a suite of outcome delivery incentives reflecting the priorities of our customers
  • an innovative customer sharing mechanism - WaterShare+ which offers customers a tangible stake and a greater say in the business.

An investor document summarising key metrics from Ofwat's Final Determination has been published on the Pennon website and can be accessed by the following link: https://www.pennon-group.co.uk/investor-information

Following the decision to accept South West Water's Final Determination, the outcome will be taken into account as part of the ongoing review of the strategic focus, growth options and capital allocation policy for the Pennon Group.   

Pennon's current dividend policy expires in 2020, and it is Pennon's intention to announce a new dividend policy by the full year results announcement scheduled for 4 June 2020.