Pennon Group PLC, owners of South West Water, has announced an increase of 9.8 per cent in profit before tax for the water company in their financial results year ended 31 March 2012.
Overall profit for the group was up 6.4 per cent to £200.5m but it was hindered by a loss at its waste company Viridor. Revenue also rose by 6.4 per cent to £1.233bn, with operating profit standing at £268.8m.
£257.4m has been invested in key infrastructure while Pennon Group has £1.084bn in cash and facilities at 31 March 2012.
South West Water’s operating profit increased by £14.9m to £204.7m with revenues rising 5.6 per cent to £474m as a result of tariff increases and new connections offset by the effects of customers switching to a metered tariff. It is estimated that customers switching to metered charging has reduced revenues by £7.2m.
Capital expenditure for the year stood at £130.8m, compared to £125.1m in 2010/11. The focus for the programme remains the maintenance of existing assets; water resources and increasing the resilience of infrastructure;improving water quality; and delivering environmental improvements.
South West Water has made “substantial progress in operating efficiency”, with the company meeting its leakage target once again, two new reservoirs fully operational, and 73.4 per cent of households now metered.
Ken Harvey, Chairman of Pennon Group, said:
“Overall, this has been another very successful twelve months for the Group.
“During the year South West Water continued its very strong operational performance and is well placed to outperform the assumptions for the current K5 regulatory period. As we highlighted in March, we are confident this summer will be our sixteenth successive summer without water restrictions. This reflects our industry-leading record on tackling leakage; the addition of two new reservoirs – Park and Stannon Lakes – and long-term improvements to our distribution networks.”
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