United Utilities profit surges on higher revenue allowances and growth

United Utilities PLC on Thursday maintained its annual outlook and boosted its revenue projection for next year as it reported a surge in first half profit.

The Warrington, England-based wastewater management service provider for the North West of England said pretax profit for the six months ended September 30 was £539.2 million, up 66% from £325.3 million a year earlier.

Revenue was £1.46 billion, up 12% from £1.31 billion, which the company explained was primarily due to regulatory adjustments, including increased revenue caps and allowed wholesale revenue.

A 12% rise in operating expenses to £543.2 million from £486.8 million partially offset revenue growth. United Utilities explained the rise in operating costs related to spending on the company's underlying asset base, price increases, pay inflation, regulatory fees and power.

United Utilities declared an interim dividend of 18.51p per share, up 3.5% from 17.88p.

First half performance was in line with the company's expectations, it said.

Chief Executive Louise Beardmore said: "Investments in infrastructure, performance and affordability are delivering real progress and lasting benefits for customers, communities and the environment, helping to build a stronger, more resilient North West for the long term."

Looking ahead, United Utilities said it expects financial 2027 revenue to increase to between £2.7 billion and £2.8 billion. It predicted underlying operating costs to increase by around £100 million, which it said related to growth in the asset base and price increases, including business rates.

United Utilities shares rose 1.1% to 1,557.00 pence on Thursday morning in London.

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