South West Water profits rose 3.3% to £167.9 million, according to the preliminary financial results published by owners Pennon's Group this morning.

Pennon Group Chairman Ken Harvey said:

“The Group has delivered a resilient set of results for 2014/15. South West Water’s EBITDA was higher than last year despite the tariff freeze, thanks to a strong focus on cost efficiency, and as expected Viridor’s EBITDA exceeded last year.

Viridor has made excellent progress in its Energy business bringing five new Energy Recovery Facilities on stream in the year. Pennon is well positioned to continue to deliver profitable growth and consistent, sustainable cash returns to shareholders.

In March Pennon's Board announced the continuation of the current dividend policy, targeting 4% year-on-year growth above RPI inflation to 2020.

South West Water revenues rose +0.1% to £331.3m, despite the 2014/15 tariff freeze - attributed to continued cost efficiency.

The Group also issued 20.9m Pennon shares to finance £100.3m cash consideration for Bournemouth Water via a successful equity placing after the year end.