Trading Statement

UNITED UTILITIES GROUP PLC - Trading Statement

PR Newswire

London, March 20

United Utilities Group PLC

21 March 2013

Current trading is in line with the group's expectations for the year ending 31March 2013. The company remains on track to deliver its 2010-15 regulatoryoutperformance targets and continues to drive improvements in customer serviceand operational effectiveness.

As indicated previously, revenue is expected to increase at a rate slightlybelow the allowed regulated price rise for 2012/13, principally reflecting thecontinuing impact of a tough economic climate on commercial volumes. Underlyingoperating profit for 2012/13 is anticipated to be slightly higher than 2011/12,despite expected rises in depreciation, power and other costs, as the companycontinues to tightly manage its cost base.

United Utilities has made further progress on its regulatory capital investmentprogramme and now expects to invest at least £750 million in 2012/13, comparedwith £680 million invested in the prior year, as the company continues toinvest to maintain and improve services for customers, deliver furtherenvironmental benefits and provide a significant contribution to the regionaleconomy.

The underlying net finance expense for 2012/13 is expected to be moderatelylower than last year, mainly reflecting the impact of lower RPI inflation inrespect of the group's index-linked debt.

The total effective tax rate for 2012/13 is expected to be broadly in line withthe mainstream rate of corporation tax of 24%. This excludes the adjustmentrelating to deferred tax in the first half of the year, as a result of the UKGovernment's staged reduction in the rate of corporation tax.

Group net debt at 31 March 2013 is expected to be slightly higher than theposition at 30 September 2012. This principally reflects expenditure on theregulatory capital investment programme, payment of the 2012/13 interimdividend and payments in relation to interest and tax, largely offset byoperational cash flows. Gearing remains stable, reflecting growth in theregulatory capital value, supporting a solid A3 credit rating for UnitedUtilities Water PLC.

United Utilities will announce its full year results on 23 May 2013.

United Utilities contacts:

Darren Jameson, Head of Investor Relations +44 (0) 1925 237033

This announcement is also available at: http://corporate.unitedutilities.com/investors.aspx