Half-year operating profit falls a fifth at United Utilities

Operating profit for the six months to 30 September 2022 at United Utilities was down 22% from the previous, first half year to £259m as revenue fell £13m to £919m under inflationary pressures.

The company attributed the downturn in revenue to lower consumption of water and wastewater services, reporting cash collection as “robust” and bad debt stable at 1.8% of regulated revenue.

Financial costs at the company increased by 78% to £262m driven by a 171% hike in inflation-linked interest payable to £252m. Inflation contributed also to the other significant cost increases in prices of materials – up £20m to £62m and power – up £17m to £55m.

A net fair-value gain of £380m from £20m in the previous period eclipsed operating cost increases to take pre tax profit to £426m from £213m in the previous first half year.

United Utilities' share in its joint venture with Severn Trent Group in water retail business Water Plus generated £0.2m in revenue for the period – up from a loss of £1.8m in the previous period.

The company reported a £31m gain from its disposal of it power generation subsidiary, United Utilities Renewable Energy, for a £31m profit on net proceeds of £90.5m.