United Utilities share price: Price increase boosts group revenue

on May 22, 2014
Updated: Apr 9, 2020
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iNVEZZ.com, Thursday, May 22: United Utilities Group Plc (LON:UU) saw its revenue and profits rise in the year ended March 31, 2014, reflecting an increase in regulated prices. The utility, which provides water and sewage services to around seven million people in North West England, said that it was assessing Ofwat’s feedback after having submitted its 2015-2020 business plan in December.

United Utilities’ share price closed 0.18 percent lower at 852.50p yesterday.
**Full-year results**
Warrington-based United Utilities released its final results statement this morning, reporting that its revenue had climbed by £69 million to £1.7 billion, mostly as a result of the four percent nominal increase in regulated prices seen in 2013/14. The group’s underlying operating profit rose by £37 million to £641 million during the reported period, while underlying profit before tax climbed £38 million to £390 million.

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United Utilities proposed a final dividend of 24.03p per ordinary share, marking a five percent increase and taking the total dividend for 2013/14 to 36.04p.
Today’s results followed a trading update published in March when the utility forecast that its underlying operating profit for the 2013/14 year would be ‘moderately higher’ than in 2012/13. (United Utilities share price: Group expects ‘moderately higher’ full-year profit)

The company, which alongside FTSE 100 peer Severn Trent (LON:SVT) submitted its 2015-2020 business plan to Ofwat in December, noted that it was currently reviewing the water regulator’s feedback. The company added that it was working with regulators, customers and other stakeholders to finalise the revisions to its business plan due to be submitted by June 27.

**Scotland focus**
United Utilities, which obtained a Scottish water supply licence in 2012, revealed in today’s statement that it had won around 150 customers in the country covering around 2,000 sites and representing annual revenue in 2014/15 of around £10 million.
“We have been building our retail capability over the last two years and have rapidly secured a position as the second largest water retailer in Scotland,” United Utilities’ chief executive Steve Mogford said in the statement. “Our experience in Scotland will place the company in a strong position, in advance of full opening of the English market for business customers in 2017.”

**Analysts on United Utilities**
The 14 analysts offering 12-month price targets for United Utilities for the Financial Times have a median target of 787.50p, with a high estimate of 950.00p and a low estimate of 680.00p. As of May 19, the consensus forecast amongst 21 polled investment analysts covering the stock advises investors to hold their position in the FTSE 100 utility.
**On May 21, buy United Utilities shares at 852.50p.**
**On May 21, sell United Utilities shares at 852.00p.**

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