Anglian Water underlying profits hit by increased costs

Anglian Water has seen its underlying operating profit trimmed back as a result of higher operating costs during 2014/15.

The company’s preliminary full year results show it posted an underlying operating profit of £452.6 million for 2014/15, down from £468.9 million in the previous year.

This is put down to a 7.9 per cent increase in operating costs (£38.5 million), which includes £13.4 million in inflationary increases and £10.3 million spent on an increase in minor repair activities to improve waste water serviceability and water leakage.

Despite this fall, the underlying profit before tax increased from £167.9 million in 2013/14 to £182 million in 2014/15, largely as a result of a decrease in finance costs of £31.1 million.

Anglian Water did record revenues of £1,244.3 million, up 2.5 per cent on the previous year, but this is largely as a result of the 2.6 per cent regulatory price increase. This was offset by reduced demand as a result of a wetter spring and cooler summer that in the previous year.

The results also show that Anglian Water met all of its AMP5 regulatory obligations and invested £2.1 billion over the previous five year price control period.

The AMP6 business plan has set out a five year programme to invest £5 billion and for the largest percentage drop in prices of any of the water and sewerage companies.

Anglian Water Group chief executive Peter Simpson said: “Our plan for AMP6 continues to put customer priorities first.

“It details our plans to take our leakage level lower than ever before, to fit more meters and to help customers who struggle to pay, all while protecting our assets and the communities we serve from drought and flooding. These are the things that customers told us matter to them most.”