Water Plus recovery "more challenging, will take longer and less certain"
United Utilities has warned in a trading statement that the current economic climate was likely to draw out and add uncertainty to the recovery of its water retail joint venture Water Plus following operating issues in the first half of the year to 31 March.
It said despite Water Plus' "good progress on the issues that impacted the underlying operating performance in the first half of the year," the recovery plan for the retailer was “now likely to be far more challenging, take longer and be less certain.” This, United Utilities said, was down to its expectations that the economic climate was "expected to affect the ability of business customers to pay Water Plus."
In the statement United Utilities claimed it was "well protected against financial shocks " arising from the coronavirus pandemic owing to contingency plan and a liquidity position that are both "robust" and revenue control that will allow recovery of shortfalls.22 May 2020.
In the trading update the company said its responses to the pandemic were "designed to protect employees to ensure the company can continue to provide a great public service to customers."
The company said the storms in February reduced by £10m year-on-year its anticipated Outcome Delivery Incentives for AMP6 to a net reward of around £40m.
It said underlying operating profit for 2019/20 would be up on the previous year but offset by an accelerated depreciation charge of around £80 million in relation to bioresources assets.
Group revenue was expected to increase "largely reflecting allowed regulatory revenue changes." infrastructure renewals expenditure in the second half of 2019/20 was expected to be higher than the first half of the year it added.