Pennon Group, the company that owns South West Water, has pushed through a dividend hike despite falling to a loss in the year to 31 March 2024.
According to the company’s results, which were published this morning, the group’s revenue increased 10 per cent to £908m in the year thanks to higher customer bills.
However, a jump in debt costs pushed the group to an overall loss for the period. It reported a statutory loss after tax of £8.5m, a sharp turnaround from the £0.4m profit reported in the prior year.
Debt across the group also rose. Excluding SES Water, net debt at the end of March was £3.5bn, up from just under £3bn at the end of the prior period.
Despite these figures, the company recommended a final dividend of 30.33p per share, giving a total dividend per share of 44.37p for the year. This also included a 0.84p reduction for the £2.4m fine from South West Water prosecution.
Pennon said that during the period it had achieved: “Sector-leading internal sewer flooding performance with 100 per cent bathing water quality for [the] third consecutive year.” What’s more, the group added that it would invest £583m in its water business over the coming year to “protect our customers, the network and the environment.”
Susan Davy, group chief executive officer, said: “Overall, we have a robust financial position with solid financial performance and are well positioned for the next regulatory period. Our efficiency programmes are focused on keeping costs below inflationary levels, despite the impacts of the unprecedented wet weather.
“Furthermore, with a robust balance sheet, we are also efficiently funded and growing shareholder value. Our strategy for financing will continue to seek to ensure we remain one of the most efficient in the sector,” Davy added.
“As we look ahead to PR24, we have a robust base on which to build. It is an ambitious plan, based on the four priorities that customers care about most. We will be investing efficiently, within our total expenditure in the plan of £4.5bn, we have built in 12 per cent of efficiency keeping bill increases to a minimum, and with good support from customers at 74 per cent.”