United Utilities Sales Rise in U.K., Shares Reach 2008 High

May 22, 2014 12:30 pm ET

(Updates with shares close at 2008 high from first paragraph.)

May 22 (Bloomberg) -- United Utilities, the largest publicly traded water company in the U.K., reported full-year sales rose 4 percent as regulated prices increased. The shares closed at their highest since July 2008.

Revenue climbed to 1.7 billion pounds ($2.9 billion) in the fiscal period through March from 1.6 billion pounds a year earlier, the Warrington, England-based company said today. That matched the 1.7 billion-pound median estimate of 11 analysts surveyed by Bloomberg. Operating profit advanced 5.9 percent.

The gains took place as the company that serves about 7 million people in northwest England became the largest new entrant and second-biggest water retailer in Scotland and after industry regulator Ofwat allowed a price increase so utilities across the U.K. could invest more in infrastructure.

United Utilities, which increased the capital investment in its networks to 836 million pounds this year, also said it would pay a 36.04 pence a share annual dividend. That’s 5 percent higher than the previous year.

The company, whose shares rose as much as 1.1 percent and closed 0.5 percent higher at 857 pence, reported underlying operating profit gained to 641.3 million pounds from 604.2 million pounds, reflecting the rise in revenue and tighter cost- controls. The stock has climbed 28 percent this year.

Ofwat is reviewing the prices that the country’s water companies can charge for the five-year period starting 2015. A final decision is expected in December.

“We’re working closely with Ofwat, ahead of submission for our revised business plan at the end of June, as customers are set to benefit from below-inflation growth in average household bills for the decade to 2020,” Chief Executive Officer Steve Mogford said in a statement.