Water firm sees profit slip

The company said this was due to an underlying operating profit increase to £313m being more than offset by a £19m increase in underlying net finance expense caused by the impact of higher RPI inflation on its index-linked debt.

Despite this the board announced a dividend of 12.95 pence per ordinary share, an increase of 1.1 per cent.

But the water firm said it has carried out £383m of capital investment in its half year as it targets a spend of about £800m on projects over the full 12 months.

Steve Mogford, chief executive officer, said: “This has been a strong first half performance in which we made significant progress towards meeting our customer, environmental and financial targets.

“Customer service has again improved, resulting in our best score under Ofwat’s revised service incentive mechanism.

“We’re continuing to enhance our customer service offering and recently launched Priority Services, to provide dedicated support for those who are experiencing short or long-term personal or financial challenges.

“The acceleration of our capital investment programme continues to deliver early customer service and operational benefits. We have invested £383m in the first half of this year and remain on track to invest around £800m for the full year.

“Our systems thinking approach to running the business continues to drive innovation into our operations and we are rolling out further capability this year, including new process technology.

“Our environmental performance has remained consistently high and we were delighted to attain industry leading company status from the Environment Agency.

“Overall, we are encouraged by our progress in the early part of this regulatory period.”