Revenue at Northumbrian Water jumped towards £1bn as the supplier returned to the black during its latest financial year.
The Durham-headquartered company has reported a revenue of £952.4m for the year to 31 March, 2024, up from the £899.9m it posted for the prior 12 months.
Newly-filed accounts with Companies House also show the business made a pre-tax profit of £6.1m in the year, having posted a pre-tax loss of £49,7m previously.
The last time Northumbrian Water made a pre-tax profit was the £118.9m it achieved in the year to 31 March, 2020.
The new results also show that a dividend of £108m was paid to its owner in the year while a final dividend of £37.4m has been proposed.
Northumbrian Water is majority owned by Hong Kong-based CK Hutchison Holdings while New York private equity company KKR & Co is a minority shareholder.
The group supplies water and sewage services to people in the North East as well as water to around 2m residents in Sussex and Suffolk.
Water bills cap a ‘material risk’
The results come after the water industry warned that plans to cap bills could create a “material risk” that suppliers may fail to raise enough cash to invest in stopping sewage leaks.
Industry trade association Water UK said regulator Ofwat’s draft plans to limit the rise in household water bills to £19 a year on average will hold back firms’ ability to improve their services.
In a letter to Ofwat chief executive David Black on Wednesday, the group also warned that the bill cap will drive away investors needed for a multimillion-pound spending plan to bring Britain’s water infrastructure up to scratch.
Water UK boss David Henderson wrote: “Ofwat’s approach would make it impossible for the water sector to attract the level of investment that it needs and will reduce the UK’s attractiveness to international investment.”
The stark warning comes on the deadline day for firms and other stakeholders to respond to Ofwat’s initial proposals, which determines the sector’s bill increases, spending plans and returns for investors over the five years to 2030.
Ofwat proposed in its draft determination in July that water firms should be allowed to increase bills by a third less than they had requested on average.
Water firms had put forward plans for increases averaging £144 over five years, although there were significant variations in price changes between suppliers.
Northumbrian Water’s £17m fine
The warnings come just weeks after Ofwat revealed £168m of proposed fines for three of England’s biggest water companies for failing to manage sewage spills, including a £104m penalty for troubled Thames Water.
The fine for Thames came alongside a planned £47m penalty for Yorkshire Water and £17m for Northumbrian Water after a “catalogue of failure” by the firms, according to Ofwat in the first batch of results from its biggest ever investigation into the industry.
Ofwat said it will consider all responses “carefully” ahead of its final decision on water firms’ spending plans by 19 December.