In its latest trading update Pennon Group Plc, owners of South West Water, said that financial performance since 31 March 2009 has been in line with management expectations.
South West Water is now in the fifth year of the AMP4 period (2005 - 2010). The Group said the company remains on target to meet the current regulatory contract. OFWAT's Draft Determination for the K5 period (2010 -2015) was published on 23 July, and allows for a weighted average cost of capital of 4.5% and a K5 capital programme of approximately £640m. South West Water is currently considering OFWAT's Draft Determination for the upcomingAMP5 investment period (2010 -2015) was published on 23 July, which called for water companies to reduce overall water bills, Pennon Group said it would be responding to OFWAT prior to its Final Determination in November. Around £15m of required investment identified in South West Water's AMP5 Final Business Plan is being brought forward into 2009/10 in line with Government plans to stimulate infrastructure spending during the economic downturn.
Viridor, the Group's waste management services company, is performing well in current conditions and remains confident of delivering continued full year growth in profits.
£25m of the £43m of bank facilities required to be renewed by the end of the current calendar year were renewed in the first quarter of 2009/10 and increased to £35m.