Coronavirus Update

United Utilities Group Plc - Half-Year Results 2019

United Utilities Plc

HALF YEAR RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2019

Delivering responsibly in the North West for customers and other stakeholders

  • Improving customer service while reducing average household bills by 10% in real terms since 2010
  • Sector leading approach to affordability, supporting over 120,000 customers in vulnerable circumstances
  • Delivering a £3.9bn AMP6 investment programme, creating long-term value for all our stakeholders
  • Long track record of sharing outperformance with additional investment of £350m in AMP6
  • Strong ESG credentials across a number of leading indices 

Operational transformation over AMP6

  • Our unique Systems Thinking approach has delivered a step change in performance
  • Continuing strong performance expected to lift net wholesale ODI outperformance to around £50m
  • Recognised by Ofwat as a strong performer for customer satisfaction - achieving upper quartile SIM scores
  • On track to deliver totex outperformance of around £100m against our AMP6 scope 

Strong financial performance

  • Interim dividend in line with AMP6 growth policy
  • Pension schemes fully funded on a self-sufficiency basis
  • Robust capital structure providing resilience and future financial flexibility

Well prepared for AMP7

  • Fast-track status has provided clarity to move forward with our implementation plans for 2020-2025
  • £100m of £350m outperformance reinvestment for flying start already committed
  • Locked-in efficiencies through network delivery transformation and selection of capital delivery partners
  • Strong performance and outperformance reinvestment gives confidence heading into the next regulatory period 

Key financials

 

 

Six months ended

30 September 2019

30 September 2018

Revenue

£935.5m

£916.4m

Reported operating profit

£383.0m

£339.1m

Underlying operating profit1

£391.7m

£367.8m

Reported profit after tax

£158.6m

£212.5m

Underlying profit after tax1

£198.2m

£196.9m

Interim dividend per ordinary share (pence)

14.20p

13.76p

Net regulatory capital spend

£323.0m

£392.7m

RCV gearing2,3

62%

60%

Underlying profit measures have been provided to give a more representative view of business performance and are defined in the underlying profit measure tables below

Regulatory capital value (RCV) gearing calculated as group net debt/United Utilities Water's shadow RCV (outturn prices)

3 RCV gearing has increased primarily reflecting the one-off impact of £103m of accelerated pension deficit repair contributions and a £55m lease liability recognised under IFRS16 

Steve Mogford, Chief Executive Officer, said:

"Our customers are at the heart of everything we do - our customer satisfaction scores are consistently among the best in the water sector. Since 2010 we have reduced the average household bill by 10 per cent in real terms, while improving customer service and supporting thousands of vulnerable households. 

"I'm pleased with the transformation we have achieved over recent years - we've delivered better levels of service for customers, a more resilient network and real gains in efficiency. Our focus on innovation, coupled with sustained investment, is helping us to deliver against a challenging set of performance targets, while also protecting and enhancing the environment and supporting our local communities.

"I'm also proud to work alongside such a highly motivated and engaged team of colleagues. We've built award-winning apprenticeship and graduate schemes, and underlined our commitment to offer opportunities to people from all backgrounds by becoming an accredited partner of The Social Mobility Pledge.

 "We are well prepared for the next regulatory period and are already moving forward with our implementation plans. This, together with the sustainable improvements in performance, gives us confidence that we will continue to create long-term value for all our stakeholders."