United Utilities’ (LON:UU) share price has gained ground in London in today’s session, with investors reacting positively to the water utility’s trading update. The update comes ahead of the group’s interims on November 20.
As of 14:09 BST, United Utilities’ share price had added 0.48 percent to 794.60p, outperforming the broader UK market, with the benchmark FTSE 100 index having slipped into the red and currently standing 0.45 percent lower at 7,258.51 points. The group’s shares have added more than 16 percent to their value over the past year, as compared with about a 3.2-percent fall in the Footsie.
United Utilities posts update
United Utilities announced in a statement today that its current trading was in line with the company’s expectations for the financial year ending September 30. The company expects its revenue to be higher than the first half of last year, mostly reflecting regulatory revenue changes. Underlying operating profit for the first half of the 2019/20 financial year meanwhile is expected to be higher than the first half of 2018/19, largely on account of the higher revenue and lower infrastructure renewals expenditure (IRE).
United Utilities, however, flagged a rise in net debt by around £250 million at September 30, compared with its position at March 31, mostly on account of the prepayment of around £100 million over the group’s defined benefit pension schemes, the impact of the IFRS16 accounting standard, and the group’s investment in its asset base.
Analysts on FTSE 100 water utility
The 13 analysts offering 12-month targets for the United Utilities share price for the Financial Times have a median target of 850.00p, with a high estimate of 950.00p and a low estimate of 660.00p. As of September 20, the consensus forecast amongst 14 polled investment analysts covering the blue-chip group advises investors to hold their position in the company.