United Utilities Group PLC Trading Statement (9843I)
March 27 2018 - 1:00AM
UK Regulatory
TIDMUU.
RNS Number : 9843I
United Utilities Group PLC
27 March 2018
United Utilities Group PLC
27 March 2018
UNITED UTILITIES TRADING UPDATE
Current trading is in line with the group's expectations for the
year ending 31 March 2018.
Delivering our strategy for AMP6
We have delivered further improvements in customer satisfaction
over the year and a step change in performance since the start of
AMP6. This has been achieved through a strong customer focus,
combining higher levels of investment to improve resilience,
greater use of technology to deliver better customer service and
our leading approach to supporting vulnerable customers.
This is reflected in our Service Incentive Mechanism (SIM)
performance for which we have achieved our best ever score this
year against Ofwat's qualitative SIM measure, positioning the
company first in the final wave and achieving an upper quartile
position for the year overall.
This performance is mirrored across other customer satisfaction
metrics including an upper quartile performance in the UK Customer
Satisfaction Index covering all industries and we are the leading
listed company for the Consumer Council for Water's customer
satisfaction research.
In January, we hosted the first ever North West Affordability
summit, engaging with many of our stakeholders including customers
and building on our already leading position on affordability and
vulnerability.
Our continued leading environmental performance is reflected in
our 'Industry Leading Company' status as measured through the
Environment Agency's annual assessment. We are one of only two
companies to achieve this.
Preparations for AMP7
We are advanced in our plans for PR19, informed by extensive
engagement with customers regarding their needs and priorities. We
are on track to submit our PR19 business plan in September 2018 and
we are confident that it will deliver against Ofwat's four key
themes; great customer service, affordable bills, innovation and
resilience. These are not new for us in the way that we run our
business and have been areas of focus for us for some time. Indeed,
in many of these areas we are a leader in the industry and already
have plans in place to build on this in AMP7 and beyond.
Financials
Our innovative Systems Thinking approach continues to drive
sustainable operational improvements in service delivery,
resilience and Totex efficiencies. We maintain our existing
guidance on capital expenditure and Outcome Delivery Incentives
(ODIs).
Group revenue is expected to be slightly higher than last year,
reflecting our allowed regulatory revenue changes, partly offset by
the accounting impact of our Water Plus business retail joint
venture, which completed on 1 June 2016.
Underlying operating profit for 2017/18 is expected to be
moderately higher than 2016/17. Infrastructure renewals expenditure
(IRE) has increased slightly in the second half of the year,
although full year IRE for 2017/18 is expected to be similar to
last year.
RPI inflation has increased this year which is expected to
increase the company's regulatory capital value (RCV) by around
GBP400 million. Since United Utilities is well hedged for
inflation, there is also an impact of higher RPI inflation on our
index-linked debt and we expect the underlying net finance expense
for 2017/18 to be around GBP40 million higher than last year.
As the company continues to invest in its asset base, we expect
a small increase in group net debt at 31 March 2018 compared with
the position as at 30 September 2017.
Our responsible approach to financial risk management continues
to deliver benefits including a strong balance sheet, a stable IFRS
pension surplus and gearing comfortably within our target range of
55% to 65% net debt to RCV, supporting a solid A3 credit rating for
United Utilities Water with Moody's.
Full year results
We will announce our 2017/18 full year results on 24 May
2018.
United Utilities contacts:
Gaynor Kenyon, Corporate Affairs Director +44 (0) 7753
622282
Robert Lee, Head of Investor Relations +44 (0) 1925 237033
Peter Hewer, Tulchan Communications +44 (0) 20 7353 4200
LEI 2138002IEYQAOC88ZJ59
Classification - Trading update
This information is provided by RNS
The company news service from the London Stock Exchange
END
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