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Financial performance and expenditure of the water companies in England and Wales 2008-09
Our financial performance and expenditure report examines the operating profits, cash flows and balance sheets of the regulated water and sewerage companies and water only companies in England and Wales for the financial year 2008-09.
Financial performance
- Pre-tax profits decreased by 22% to £1.8 billion. This is despite a 7% increase in operating profits.
Operating expenditure
- Total operating expenditure increased by 2% in real terms to £3.6 billion – still 9% less than the companies assumed in their final business plans at the 2004 price review.
- Energy costs increased significantly. The companies paid an average of 25% more for their energy in 2008-09.
Investment
- The companies invested £4.6 billion in 2008-09 to maintain and improve assets, 14% more than we assumed when we set price limits in 2004. However, it is 6.8% lower than 2007-08 levels.
- Overall, investment in maintaining and improving assets is 4.8% less than we expected over the first four years of the current price review period. Much of this is the result of efficiency savings.
- Similarly, investment in quality enhancements was 24% lower. Some companies have made only limited progress in catching up with outstanding work from the previous three years. Despite this, the companies are on target to meet their statutory obligations.
- Investment to balance supply and demand for sewerage services was 32% lower than expected. Again, this is primarily the result of efficiency savings, but also because of lower than expected development activity in some areas.
- But, investment in maintenance is 10% higher than our projections. Similarly, expenditure on enhanced service levels is 17% higher, while expenditure to balance supply and demand is 22% higher.
- These increases are mainly the result of work to alleviate flooding from sewers, more optional metering and more expenditure on leakage control.
Financial performance and expenditure report
Download the Financial performance and expenditure of the water companies in England and Wales 2008-09 (PDF - 879Kb) and supporting tables (XLS - 738Kb).
