Cost cuts bolster pre tax profit at Affinity
Affinity Water reported a near 42% hike in profit before tax at £35.9m fuelled by year-on-year cost reductions for the year to 31 March 2018 as well as profit from the disposal of its non-household retail operation and subsequent cost reductions.
Operating profit was down on the previous year by 7.1% at £72.27m on revenue a shade lower at £306.3m with cost of sales up £6.78m at £200.42m. This was offset by a £3.37m cut in administrative expenses.
A £3.7m fall in net finance costs and a £10.96m profit from the sale of its non-household retail business boosted pre tax profit for the year.
Affinity’s ambitions for unplanned supply interruptions in fewer than 320 properties were laid to waste by the disruptions caused by the freeze/thaw episodes during February and March 2018. While 7,890 properties experienced unplanned interruptions during the report year, Affinity said excluding the impact of the severe weather it achieved its performance commitments for the whole of the second half of the year.
The company reported mains bursts below its 3,100 target at 2,923 Affinity said its “continual increased focus on customers,” had improved its customer service and produced a 32% reduction in complaints and 34% reduction in escalated complaints compared to 2016/17. It improved its SIM by 2.4 points from the previous year to 80.9.