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Thames Water Utilities Ltd on Tuesday said it had made ‘solid progress’ on its turnaround as net debt increased again to £15.80 billion and it swung to a loss on exceptional restructuring costs.
It is England’s biggest water utility company, with around 16 million customers. The company is in a funding crisis, and previously said it was seeking equity investment and requires £3.3 billion to keep operating for the next five years.
Revenue increased by 9.7% in the six months to the end of September to £1.39 billion from £1.27 billion year-on-year.
Thames Water swung to a total pretax loss on ordinary activities of £230.9 million from a £73.2 million profit in the prior year. This was impacted by £465.5 million costs from exceptional items, which the company said related to its restructuring and transformation plans.
Underlying pretax profit multiplied to £168.1 million from £32.5 million year-on-year.
The company said it did not pay any dividends during the period.
Net debt increased by 7.2% to £15.80 billion at the end of September from £14.74 billion at the same time last year.
Thames Water has been at the centre of growing anger at the UK’s privatised water firms over high dividends, executive pay and bonuses, and ongoing river pollution.
The company reported that its category one to three total pollutions increased by 40% to 359 from 257 in the period, which it blamed on record rainfall.
It recently asked water regulator Ofwat to let it raise average bills by 59% over the next five years.
Chief Executive Officer Chris Weston said: ‘In the last six months we’ve made solid progress on the transformation and turnaround of Thames Water...We have continued to improve operational and underlying financial performance, with leakage at an all-time low and investment remaining at high levels in the first half of the year.’
He said the company had reached key milestones by agreeing a liquidity extension transaction proposal and progressing its equity raise process.
Weston said the upcoming final determination from Ofwat is ‘fundamental to our future’. Thames Water noted that it would appeal Ofwat’s decision to the Competition and Markets Authority if necessary. The final decision is due on December 19.
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