United Utilities eyes profit rise as cost management pays off

WATER company United Utilities yesterday said it expected operating profit to be slightly higher than last year, as the firm continues to keep a tight rein on costs.

The FTSE-listed utility, which provides water and sewage services to around 7m people in the north west of England, said it was on track to hit its outperformance targets by 2015.

United Utilities reaffirmed that it expected higher revenues at a rate slightly below the regulated price rise for this year, reflecting the tough economic climate.

The capital investment programme for this year will weigh in at least £750m, United Utilities said, an uptick from £680m in the previous year – and one that will contribute to a slightly higher net debt.

“The company continues to invest to maintain and improve services for customers, deliver further environmental benefits and provide a significant contribution to the regional economy,” the company said.

Markets cheered the trading update, with shares closing up 1.94 per cent yesterday at 709p.