United Utilities says it has delivered strong financial performance in 2025/26 - the first year of AMP8 – its preliminary, unaudited full year results show underlying revenue increased 20% in line with allowances set out in the PR24 Final Determination, resulting in an underlying operating profit of £1.06 billion, a 35% increase compared with the prior year.

Underlying operating profit was £274 million higher than last year, reflecting the increase in revenue, partially offset by higher operating costs than the prior year. Operating costs have increased primarily due to expenditure associated with growth in the underlying asset base, as well as price increases across regulatory fees, power and chemicals.

Underlying profit before tax is £738 million compared with £514 million underlying profit before tax last year. The £224 million increase reflects the £274 million increase in underlying operating profit and a £6 million reduction in the share of losses of joint ventures. Reported profit before tax is £41 million higher at £779 million.

Underlying net finance expense increased as a result of increased debt to fund the AMP8 capital programme, resulting in an underlying profit after tax of £730 million and underlying earnings per share of 107.1 pence. Reported profit after tax was at £587 million, with reported earnings per share of 86.1 pence.

Revenue was up £471 million at £2.616 billion, with £447 million attributable to regulatory adjustments. Adjustments include a c.23% real increase in allowed wholesale revenues as set out in its PR24 Final Determination as well as a 3.5% CPIH-linked increase to the revenue cap.

Other revenue impacts largely reflect variances in consumption. Reported revenue included £40 million of revenue allowed by Ofwat for recovery in AMP8 related to diversions activity to accommodate the now-aborted northern leg of HS2, which will be returned to customers over the course of AMP9.

During the year the company saw capital investment of £1.525 billlion, with asset base growth of 7.5% to £16.5 billion.

United Utilities described the company as financially resilient, with gearing at 60% in the middle of UU’s 55-65% range, supporting solid credit ratings with Moody's, Fitch and S&P.

Operational highlights - great start to first year of AMP8

Operational highlights flagged up by the company during the year include:

• Great start to the first year of the AMP, with supply chain mobilised and delivering efficiently at scale, with over 1,000 live projects and year one regulatory commitments met
• Driving down spills, achieving a 23% reduction in the number of spills and a 27% reduction in duration since the prior year
• Significant reduction in sewer flooding, with 42% fewer internal flooding incidents and 25% fewer external sewer flooding cases year-on-year
• Zero category 1 pollutions, the most serious form of pollution
• Year-on-year improvement, with over 80% of key performance metrics improved since 2024/25

Operational review

UU says its AMP8 capital delivery is progressing to plan – the firm has successfully recruited over 1,300 new colleagues whilst at the same time onboarding over 100 suppliers to help it deliver its ambitious programme. According to UU the scaling-up of activity has not impacted its quality, with the Capital Programme Delivery Incentive (CPDI), its measure of effective, efficient and quality delivery of the capital programme, hitting 100%.

As AMP8 scales up, UU says its award-winning approach to standardisation, Project Blueprint, is playing a vital role in keeping the firm within cost and quality allowances while accelerating delivery for customers and communities. The water company says that by standardising designs, bulk-purchasing materials and embedding more efficient maintenance regimes, it is cutting cost and time across multiple projects. This approach allows it to identify repeatable solutions, streamline design, and secure critical components early.

Continuous improvement across operations including installation of 200,000 meters

UU is reporting a strong start to the year, with the majority of operational performance measures improving year-on-year. Long-term investment in dynamic network management is supporting improved performance in meeting stretching targets for both internal and external sewer flooding, despite last year's stormy weather, with internal sewer flooding down 42% and external flooding down 25%.

Spills performance also improved, with activations falling 23% and duration falling 27% versus the prior year. UU says it remains firmly on track to deliver a 60% reduction in spills by 2030.

The company also made strong progress on smart metering, installing more than 200,000 meters during the year which marked the first phase of a sustained rollout across the region.

Future areas of focus

The water company says it is staying focused on the areas where it can go further, including:

Total pollution incidents: UU recorded no category 1 pollutions, the most serious form of pollution. However, despite a reduction in category 2 and 3 pollution incidents compared with the previous year, UU expects an overall penalty for FY26 for this measure. Industry reporting rules have changed, meaning incidents previously excluded, such as those caused by extreme weather and power supply interruption, are now counted. Around 21% of UU’s 2025 incidents were linked to named storms, including 12% during Storm Éowyn.

Leakage: another key area of focus. This year UU fixed more leaks than ever and replaced over 150 km of mains, more than in the previous five years combined, supporting long term leakage reduction and fewer supply interruptions. While in year leakage performance is the best the North West has ever seen, despite this UU expects to miss its egulatory three year rolling average target, reflecting the impact of prior years and the time it takes for the rolling methodology to capture improvements.

Affordability & accessibility: UU has strengthened its sector leading affordability support and its ambition to help one in six customers is progressing well, with over 422,000 customers now receiving support. Working with partners such as the Department for Work and Pensions, 180,000 customers have been proactively moved onto better tariffs without them needing to get in touch. More than 580,000 customers are now registered for priority services, enabling the company to tailor support for those who need it most.

Looking ahead - unlocking growth in the new economy

UU has now submitted its plans to Ofwat for additional investment to support housing growth, the new economy and proactive asset replacement. The water company expects the £1.4 billion in additional investment could support a further 4,000 jobs across its supply chain, on top of the 30,000 supported by its existing AMP8 programme.

The investment programme sets out how it will deliver vital water infrastructure required for thousands of new homes across the region, unlock capacity for data centre expansion and facilitate decarbonisation. UU has also outlined further investment in its assets to strengthen the resilience and reliability of its networks, treatment works, and services.

Plans for a further c.£1.2 billion of investment are expected to be submitted for approval through subsequent submissions in 2027 and 2028 and transitional investment into AMP9, taking total incremental investment to c.£2.5 billion and total AMP8 capital investment to c.£11.5 billion.

Capital investment and regulated asset growth

The capital programme for the five years to March 2030 (AMP8) is significantly larger than previous regulatory periods, due to long-term investment drivers. UU is expecting capital investment to be c.£11.5 billion, up from prior guidance of c.£9 billion, supporting a c.10% compound growth in the asset base between 2025 and 2030.

Underlying revenue is expected to increase to between £2.7 billion and £2.8 billion in 2026/27. This figure includes pass-through items of c.£110m relating to the Haweswater Aqueduct Resilience Programme (HARP) (£70m, FY26: nil) and HS2 diversions income (£40m, FY26: £40m).

Underlying operating costs are expected to increase by around £100 million relating to growth in the asset base and price increases, including business rates.

Capital expenditure (Capex) in 2026/27 is expected to be around £2 billion.

Dividend per share increases

The Board has proposed a final dividend of 35.78 pence per ordinary share in respect of the year ended 31 March 2026, an increase of 3.5% compared with the dividend last year, in line with the group's dividend policy of targeting a growth rate of CPIH inflation each year.

The final dividend is expected to be paid on 3 August 2026 to shareholders on the register at the close of business on 26 June 2026. The ex-dividend date for the interim dividend is 25 June 2026.