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Utilities company Pennon has reported a robust balance sheet and financial resilience in its full year results with revenues increasing, although pre-tax profits slipped. Boss Susan Davy said the business had also delivered improvements in environmental performance, adding “one pollution is one too many, and numbers are falling as we implement sustained change”.
Pennon’s largest business, South West Water, provides water and wastewater services to a population of about 1.8 million in Cornwall, Devon and parts of Dorset and Somerset,
In its full year results for 2022/23, underlying revenue at the Exeter-headquartered group rose 4.1 per cent to £825m from £792.3m.
However, underlying pre-tax profits dipped 88.3 per cent to £16.8m from £143.5m. The business said the reduction compared to the prior year reflected the “flagged near-term pressures on earnings from inflation driven power and financing costs”.
It said the underlying revenue increase includes growth in non-household demand, supported by contract wins from Pennon Water Services, in areas outside of its wholesale supply regions, and a full twelve-month contribution from Bristol Water.
Susan Davy, group chief executive, noted it had been an “extraordinary year” for Pennon in which extreme weather patterns tested its operational resilience, while she said inflationary pressures had proven its financial resilience.
“In a year in which the sector has been rightly challenged to clean up its act, we have delivered improvements in environmental performance, building on our sector leading 100 per cent water quality for our 860 miles of coastline and on track to reduce our use of storm overflows by 50 per cent by 2025.
“I am also clear that one pollution is one too many, and numbers are falling as we implement sustained change.”
She added: “And given the ongoing volatility of the energy markets, we have boosted the renewable energy pillar of our Net Zero strategy, with investments in energy generation well underway, and with more to come,” she added.
“We can do all this, because of our robust balance sheet and financial resilience, supported by year on year increases in outperformance. In summary, we are tackling the biggest challenges head on, focusing on the things that matter most, investing more, and in building the capabilities for the future.”
