Wessex half-year results: investment on schedule compared with peers

(by Verity Mitchell)

Total revenues at Wessex Water increased by £45.5m to £332.5m, up 15.8%, mainly due to price rises permitted under regulatory mechanisms, according to a commentary on its half-year results.

Operating profit increased by 25% from £78m to £97.7m. Bad debt charges grew by £0.7m because of the effect of new pricing but were lower as a proportion of overall household revenues.

Net capital investment for the six months was £248m, a significant increase on £189.6m last year, up 30.8%. Management confirmed the spend was consistent with the schedule for the construction programme for the current regulatory period – unlike some of Wessex’s peers.

For the previous financial year, Wessex Water had a two-star rating in the Environmental Performance Assessment survey published in November. Wessex remained in the average category in Ofwat’s annual performance report, published in October. It did not meet its commitment level on four categories in 2024: leakage, supply interruptions, internal sewer flooding and pollution incidents.

Wessex agreed an £11m redress package in November after Ofwat’s enforcement investigation deemed that it had breached statutory obligations and a licence condition in the operation of its sewage treatment works and sewerage network. It agreed to: 

• Create a £1.1m Rainwater Management Fund that will support customers in managing rainwater sustainably at their properties to prevent rainwater entering combined sewers and reducing potable water use, thereby reducing customer bills. 

• Make a £1.3m investment in installing flow monitors at 133 sites, covering costs that would otherwise have been funded by customers under the price review. 

• Allocate £8.6m between engaging with private landowners and investing in sealing privately owned drains and sewers to reduce the level of infiltration into the company’s own network and investing to reduce spills at specific storm overflows. The investment is additional to that already planned for 2025-30 and relates to storm overflows that were not scheduled for improvement until after 2030.