United Utilities' pre tax income eroded by hike in finance cost
United Utilities’ underlying profit before tax for the six months to 30 September 2017 was up just 2.6% to £194m on the same period in the previous year after the impact of inflation on index linked debt upped finance expenses by £29m to £155m. Revenue was up year-on-year 2.7%year-on-year at £876m after the accounting impact of its Water Plus joint venture with Severn Trent offset a £13m increase in income from property disposals.
A £16m year-on-year drop in total costs boosted underlying operating profit 10% to £344m. A £34.5m fair value gain in derivatives after a £54.8m in fair value losses at the previous interim is reflected in a 53% hike in reported profit before tax to £242m.