19th Sep 2013 07:48
WARRINGTON (Alliance News) - United Utilities Group Plc. (UU.L) Thursday said that current trading is in line with the group's expectations for the first half of the year, and it sees year-over-year increases in revenue and underlying operating profit.
Revenue is expected to increase from last year, as a result of the regulated price increase for 2013/14. As the company had stated earlier, this revenue increase is expected to be slightly below the allowed regulated price rise, mainly due to the impact of a tough economic climate on volumes.
Underlying operating profit for the first half of 2013/14 is estimated to be moderately higher than the first half of 2012/13, helped by tight management of cost base.
United Utilities said it remains firmly on track to deliver its 2010-15 regulatory outperformance targets. It has made good progress on its regulatory capital investment program and expects to invest around 800 million pounds in 2013/14, including infrastructure renewals expenditure.
The underlying net finance expense for the first half is anticipated to be similar to the first half of last year.
Group net debt is expected to be slightly higher from the position at March 31, 2013, reflecting expenditure on the regulatory capital investment program, payment of the 2012/13 final dividend, and payments in relation to interest and taxation. This will largely be offset by operational cash flows and fair value gains on the group's debt and derivative instruments.
According to the utility, gearing remains stable and comfortably within Ofwat's assumed range, supporting a solid A3 credit rating for United Utilities Water.
''The company is well advanced in preparation of its business plan for the 2015-20 period following extensive consultation with customers, regulators and other stakeholders and is on track for plan submission to Ofwat, as required by 2 December this year,'' the utility said.
United Utilities is slated to announce its half year results on November 27.
The stock is up 1.7 percent in early morning trade at 703 pence.
Copyright RTT News/dpa-AFX
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