At the same time, inflationary pressures have proven our financial resilience. We have been able to respond to both, with agility and pace, focusing on the things that matter right now, and tackling the biggest challenges head on. Whether it's the use of storm overflows, water resilience, the cost of living crisis or climate change, we are investing more than ever before. We are also investing for the future.
In a year in which the sector has been rightly challenged to clean up its act, we have delivered improvements in environmental performance, building on our sector leading 100% water quality for our 860 miles of coastline and on track to reduce our use of storm overflows by 50% by 2025. I am also clear that one pollution is one too many, and numbers are falling as we implement sustained change.
Water is essential for life. As one of only two regions officially in drought, and with the hottest, driest, weather on record, we are investing to break through the drought cycle, deploying innovative solutions such as desalination, repurposing ex quarries and mines into mini reservoirs to create more capacity in
At Pennon, we believe that every customer should benefit from what we do especially in this cost of living crisis. With over
And given the ongoing volatility of the energy markets, we have boosted the renewable energy pillar of our Net Zero strategy, with investments in energy generation well underway, and with more to come.
We can do all this, because of our robust balance sheet and financial resilience, supported by year on year increases in outperformance. In summary, we are tackling the biggest challenges head on, focusing on the things that matter most, investing more, and in building the capabilities for the future.
Underlying revenue increase includes growth in Non-household demand, supported by contract wins from Pennon Water Services4, in areas outside of our wholesale supply regions, and a full twelve-month contribution from
Net non-underlying costs before tax of
Statutory profit after tax of
Adjusted earnings per share of
Statutory earnings per share of nil pence after net non-underlying costs. Statutory earnings per share for 2021/22 were impacted by the significant non-underlying deferred tax charge in respect of the change in corporation tax rate.
Group RORE2 for 2022/23 of 10.5% reflecting an increase of 1.6% on 2021/22.
Delivering on established K7 (2020-25) dividend policy - total dividend up 10.9% (CPIH +2%) to
A full reconciliation to the statutory reported results is included in item (i) in the Alternative Performance Measures on pages 58 to 63 of this announcement.
MAKING PROGRESS AGAINST OUR KEY PRIORITIES
Improving environmental water quality c.50% reduction in pollution incidents since 2020, c.30% reduction delivered in 2022. c.30% reduction in storm overflow use over 2022 to an average of 285 (2021: 39) and a c.50% reduction during the bathing season. This is supported by our WaterFit investment, which remains on track to reduce releases to an average of 205 by 2025.
Installation of monitors at 100% of storm overflows completed, one year ahead of target.
Achieved 100% bathing water quality, as assessed by the
Reduced our impact on rivers by almost one third to date, from 19% to 12.6%6, well ahead of our target of 12% by 2025, and river water quality pilots underway.
Water resilience and quality
Investing c.
Significant increase in water resources available by 2025 -
Climate change and Net Zero
Delivering on our Net Zero 2030 plan, having already reduced our carbon footprint by c.40% since 2021. c.
Addressing customer affordability
Keeping bills as low as possible - below inflation bill increases for
Over
Financially resilient Year on year reduction in gearing8 to 60.8%, broadly in line with Ofwat's notional assumption.
Pension scheme c.
Delivering on our largest ever environmental investment programme c.50% increase in capital expenditure in 2022/23, investing over
RORE outperformance and Pennon balance sheet strength supporting reinvestment in accelerated and additional initiatives totalling c.
Investment of c.
Driving long-term sustainable growth Sustainable, profitable B2B retailer growth.
On track to deliver a high quality, ambitious plan for PR24 - balancing a step change in investment with a continued focus on customer affordability.
Twin-track strategy for growth - delivering RCV growth of >50% over K7, positive outlook for RCV growth in K8 and beyond.
Presentation of results
A presentation of these results hosted by
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