Wessex Water’s newly-released financial results for 2024/25 showed turnover increased from £574.4 million to £652.6 million, while the position after taxation improved from a loss of £33 million in 2023/24 to a profit of £11.7 million.

Profit before tax increased by £60.2 million from a loss of £43.2 million last year to a profit of £17 million - primarily due to the underlying reduction in interest costs and the increase in revenues.

Capital investment increased by 13% year on year, to £446.5 million, up £50.9 million from £395.6 million last year. Operating cost increases of £53.4 million(12.1%) are attributed principally to business rates, new obligations, one off charge for impairment of intangible assets and other inflationary pressures.

On 19 March 2025 Wessex Water Services Finance Plc agreed terms for the issue of 2 corporate bonds with a combined value of £600 million, one for £350 million with a maturity of September 2034 and a coupon of 6.125%, the second for £250 million with a maturity of September 2040 and a coupon of 6.5%. The net proceeds from the issue of the bonds were loaned to Wessex Water to fund its investment programme and repay £50 million of European Investment Bank term loans due in May 2025.

There is no intragroup funding to the company, all debt is raised by the company at market rates and is provided by external third parties.

The UK group structure has remained the same since 2002 with the company wholly owned by Wessex Water Ltd, which in turn is wholly owned by YTL Utilities (UK) Ltd.

YTL has now owned Wessex Water for 23 years, making it the longest single owner of a UK water and sewerage company. During this time YTL has maintained a simple financial structure, avoiding any aggressive or artificial tax planning.

During the year the company declared dividends of £66.5 million representing a yield of 5.0% on the company’s regulatory equity. Regulatory capital value increased by £263 million from £4.305 million to £4,568 million.

Regulatory gearing increased as higher capital investment impacted debt levels, leaving gearing at the end of the year at 71.9% compared to 68.8% last year.

Operational performance

The water company’s new look integrated annual report also provides updated figures on its performance throughout the financial year 2024-25. 

Commenting on operational performance, the report describes 2024-25 as “a challenging year with several named storms, significant high levels of rainfall, and robust public and media scrutiny.”

Wessex Water has 46 performance commitments of which 44 have targets for 2024-25 – the utility met or exceeded targets for 30 performance commitments , with a strong performance on the C-Mex measure and an improving position over a number of performance commitments notably priority services, leakage and per capita consumption.

The report flags up the company's decades-long record of providing top customer service which continued into 2025, topping Ofwat’s annual Customer Measure of Experience (C-MeX) table for customer service and scoring second overall out of all water and sewerage companies in England and Wales.

However, the report says Wessex Water has not met 14 of its performance commitments, most notably on water supply interruptions, pollutions and sewer flooding, resulting in several underperformance financial penalties. The company also failed to chieve its percentage reduction target for leakage, incurring an underperformance payment penalty of £2,013,000.

The report is also highlighting the Wessex Water Marketplace, the open data platform which the company has used for six years now, to share its challenges and associated data with interested parties. The Marketplace is the hub for Wessex Water’s collaborative whole system approach, which includes:

• enabling and championing new ideas – both from the traditional supply chain and beyond
• being open-minded about who is best placed to deliver a solution
• collaborating to find the best and lowest cost options – these may even address more than one issue at once.

In October the utility launched a new Marketplace challenge focusing on PFAS (per- and polyfluoroalkyl substances) which is looking at how to get the best out of its PFAS data and maximise the efficiency of analysis. Wessex is now exploring initial pilot work with shortlisted suppliers, while some of the other proposals may be suitable for an Ofwat innovation fund bid.

The company’s bid assessment frameworks for third-party providers for water resources and bioresources are also published on the Marketplace website. However, Wessex received no approaches under these frameworks in the year.

AMP8 investment

Ofwat’s final determination in December 2024 allowed for £4.2 billion of total expenditure – 17% short of the amount requested by the company. 

In February 2025, Wessex Water, along with five other water companies, asked the Competition and Markets Authority (CMA) to review how much it can invest in water and sewerage improvements over the next five years.

Commenting in the foreword to the report,Chairman Tan Sri (Sir) Francis Yeoh KBE said:

“Our regulatory settlement for 2025-2030, the PR24 final determination, delivered by Ofwat in December 2024, has been an important moment for us. ...

“However, we believe the funding provided by the final determination fell significantly short of the investment we require to deliver the service our customers rightly expect and to meet our statutory obligations….

“It is also critical that we and the wider sector remain investable through a satisfactory economic settlement and a more effective regulatory framework.”

Commenting separately, Chief Executive Ruth Jefferson stressed that regardless of the CMA’s decision, Wessex Water remains focused on delivering positive outcomes for customers and the environment.

“We plan to double our investment, an additional £2 billion between 2020 and 2025, tackling a range of issues that matter to our customers..

“We will further reduce leakage, increase the resilience of our water supply network, help customers reduce water demand through initiatives such as smart meters, and continue tackling storm overflow discharges.

“Where possible, we want to achieve these goals in ways that help the environment, such as harnessing nature-based solutions for water and wastewater treatment instead of building more carbon-intensive concrete infrastructure.”

Click here to download the Integrated Annual Report 2024-25