Pre-tax income jumps 59% at South Staffordshire Water

South Staffordshire Water has reported a 59% hike in profit before tax to £14.89m for the year to 31 March 2021.

Turnover for the report period at the South Staffs Water and Cambridge Water parent group ticked up £0.5m to £130.3m year-on-year while operating profit was up £5.8m to £28.2m. Operating cost fell £4.7m to £108.1m.

The impact of Covid on revenues mirrored that seems across the sector with business revenues falling £3.9m – an 18% decline – with household sales up 4.4% to £4.26m.

Return on regulated equity (RORE) at -06% fell short of the group’s allowances by 4.7 percentage points despite “a strong performance on outcome delivery incentives and total expenditure based on Ofwat’s calculation.” The company attributed 4.2 percentage points of the RORE underperformance largely to interest on its mainly long-term, inflation-linked borrowings outstripping Ofwat’s assumed interest rate under current price controls.