Last checked at 11 Nov 2009 07:00
BRISTOL WATER plc
Announcement of interim results for the six months ended 30 September 2009
Bristol Water plc is a subsidiary of Sociedad General de Aguas de Barcelona S.A.
| For further information: | ||
| Alan Parsons, Managing Director Stefano Pellegri, Finance Director Bristol Water plc | ||
| Tel: | 0117 953 6407 | |
| or contact: Bristol Water Corporate Affairs on 0117 953 6470 during office hours or 07831 453924 or 07831 518964 at any time | ||
HIGHLIGHTS - REPORTED UNDER UK GAAP
| Six months ended 30 September | 2009 | 2008 | ||
| (unaudited) | (unaudited) | |||
| £m | £m | |||
| Turnover | 49.8 | 48.9 | ||
| Operating profit | 14.9 | 15.0 | ||
| Profit before taxation | 14.7 | 10.0 | ||
| Profit after taxation | 10.7 | 8.2 | ||
| Regulatory Capital Value (RCV) - forecast year end | 264 | 276 | ||
| Net debt (excluding 8.75% irredeemable cumulative preference shares) as percentage of forecast RCV at year end | 74% | 72% | ||
Operating profit £14.9m - 1% decrease
Profit before taxation £14.7m - 47% increase reflecting lower interest costs and loan indexation linked to RPI
Capital investment of £13.0m in the period
Net debt, excluding irredeemable cumulative preference shares, of £196.8m - approximately 74% of projected RCV at 31 March 2010
Bristol Water plc supplies water to over 1.1 million people and businesses in an area of almost 2,400 square kilometres centred on Bristol.
CHAIRMAN'S STATEMENT
Introduction
We submitted our Final Business Plan to Ofwat in April 2009, in which we outlined our proposed pricing and capital expenditure plans for the five years beginning April 2010. In reply to our submission, Ofwat issued a Draft Determination in July 2009. In early September 2009 we responded to this Draft Determination and have continued since then to liaise with Ofwat to enable us to achieve the best possible outcome for our customers. We currently await the Final Determination due from Ofwat in late November 2009.
Operational performance
We are only six months from the end of the current regulatory period 2005-10 and we anticipate full delivery of the outputs required by Ofwat's determination of price limits for the current period. Three major capital schemes have been completed:
A £24m project to improve the security of supply for a population of almost 200,000 in the northern and eastern parts of Bristol and surrounding areas. The new network has already been used three times since completion despite initial expectations that it would be rarely used. Such resilience schemes are vitally important to providing the service customers expect in a time of crisis, however it arises.
A £14m project to upgrade our Banwell treatment works to improve its effectiveness in dealing with a range of different raw water qualities. The complexity of the new technology being used is challenging and finalisation of commissioning and optimisation continues, although treated water has been put into supply for some time.
A £7m project to construct a new treatment works to treat water from the River Axe.
In total, we invested £13m in capital projects during the period. We currently anticipate a total investment programme for the current 5-year regulatory period of approximately £171m (at current prices, before grants and contributions). This is in line with Ofwat's assumptions.
In the October 2009 publication of the Ofwat OPA (Overall Performance Assessment) for 2008/09 the company scored 97% of the maximum total score but was only ranked in tenth position out of a total of 21 companies. This is a disappointment following third position in the previous year and reflects higher numbers of unplanned interruptions to customer supplies, emphasising the need for higher levels of mains replacement. We continue to meet our leakage target and our customer service performance remains at high levels. The latest customer surveys also continue to show high satisfaction levels. We are pleased to report that we achieved top position in Ofwat's latest industry wide assessment of customer satisfaction for handling telephone contact.
Financial performance
Operating profit for the period decreased by £0.1m to £14.9m. Profit before tax increased by £4.7m to £14.7m as a result of lower interest costs.
Net interest charges, excluding those related to retirement benefits and the preference share dividend, reduced by £5.2m from a charge of £4.4m to a credit of £0.8m. This mainly reflects the impact of negative RPI on our indexed-linked debt. In contrast to this, net interest charges in relation to retirement benefits increased by £0.4m compared to the same period last year.
The tax charge of £4.0m represents an effective tax rate of 27% (2008: 18%). The lower charge in the comparative period was a result of higher discount rates prevailing at 30 September 2008.
Net debt, excluding the irredeemable preference shares, decreased to £196.8m (31 March 2009: £201.8m) as a result of negative RPI on index-linked debt and represents approximately 74% of forecast Regulatory Capital Value at 31 March 2010. As previously indicated we currently anticipate that this ratio will remain between 70% and 80% for the period to 31 March 2010.
Prospects
In the Directors' Report and Business Review within the company's Annual Report and Accounts 2009 we set out a summary of the key risks and uncertainties facing the company. The main risk areas are operational problems, performance and regulatory requirements and developments.
We anticipate that the results for the second half of the year will include the following material effects:
An increase in energy and chemical costs over the previous year due to increased market prices.
A continued increase in bad debt charges above 2008/09 levels due to increasing levels of unemployment.
Increased reactive maintenance costs due to the winter period and leakage control.
In July 2009 Ofwat indicated in its Draft Determination of prices that the K profile for the company would be -1.8% cumulatively in the next five years beginning April 2010. The company has reviewed this draft and believes that it is not satisfactory on a number of levels. The company believes that Ofwat's proposals do not adequately address the needs of our customers. Accordingly, it has submitted a robust response. The company and the Board expects that Ofwat will address these concerns in the Final Determination due to be published on 26 November. The company has the opportunity to appeal the Final Determination to the Competition Commission. An announcement will be made after the Board has had the opportunity to consider fully the Final Determination.
In concluding on the appropriateness of adopting the going concern basis in preparing the interim financial statements, the Directors have considered the above factors together with the company's cash position and are satisfied that the company has adequate funding in place to cover its committed capital expenditure programme and current working capital requirements together with the maintenance of an appropriate capital programme until matters regarding the Final Determination are finalised. As noted above, the Directors are of the opinion, that bearing in mind their understanding of Ofwat's legal duties, the company's concerns regarding the Draft Determination should be satisfactorily resolved, if necessary by the Competition Commission. Accordingly they continue to adopt the going concern basis in preparing the interim financial statements.
Dividends
The company policy is to pay an annual level of ordinary dividends comprising:
A base level reflecting the cost of capital allowed by Ofwat in the 5-year determination of price limits, adjusted to reflect actual gearing levels and where appropriate actual performance relative to Ofwat's assumptions.
An amount equal to the post-tax interest receivable from Agbar UK Limited (formerly Bristol Water Group Ltd - the ultimate UK parent company) in respect of intercompany loans.
During the period an interim ordinary dividend of £1.5m in respect of the 2009/10 interest element of the intercompany loan was paid.
A final dividend of £3.6m in respect of 2008/09 was approved at the last Annual General Meeting. It was paid on 29 September 2009.
A second interim ordinary of £3.7m in respect of 2009/10 was approved by the Board on 11 November 2009 and will be paid subsequently.
Board membership
We welcome Miquel Anglada Gali who has been appointed to the Board as an executive director on 12 October 2009.
Moger Woolley
Chairman
11 November 2009
PROFIT AND LOSS ACCOUNT
For the six months ended 30 September 2009
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | ||||||
| Note | £m | £m | £m | |||||
| Turnover | 2 | 49.8 | 48.9 | 96.7 | ||||
| Operating costs | 3 | (34.9) | (33.9) | (67.6) | ||||
| Operating profit | 14.9 | 15.0 | 29.1 | |||||
| Other net interest receivable/(payable) and similar | ||||||||
| income/(charges) | 4 | 0.8 | (4.4) | (10.4) | ||||
| Dividends on 8.75% irredeemable cumulative preference | ||||||||
| shares | (0.5) | (0.5) | (1.1) | |||||
| Interest in respect of retirement benefit scheme surplus | (0.5) | (0.1) | (0.2) | |||||
| Net interest payable and similar charges | (0.2) | (5.0) | (11.7) | |||||
| Profit on ordinary activities before taxation | 14.7 | 10.0 | 17.4 | |||||
| Tax on profit on ordinary activities | 5 | (4.0) | (1.8) | (5.3) | ||||
| Profit on ordinary activities after taxation | 10.7 | 8.2 | 12.1 | |||||
| Earnings per ordinary share | 6 | 178.3p | 136.3p | 201.7p | ||||
All activities above relate to the continuing activities of the company.
The accompanying notes to the accounts form an integral part of this statement.
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
For the six months ended 30 September 2009
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | ||||||
| Note | £m | £m | £m | |||||
| Profit attributable to Bristol Water plc shareholders | 10.7 | 8.2 | 12.1 | |||||
| Actuarial gains/(losses) recognised in respect of retirement | ||||||||
| benefit obligations | 10,11 | 2.6 | (0.4) | (5.8) | ||||
| Attributable deferred taxation | 10,11 | (0.7) | 0.1 | 1.6 | ||||
| Change in the fair value of the interest rate swap | 11 | 0.4 | - | (1.2) | ||||
| Attributable deferred taxation | 11 | (0.1) | - | 0.3 | ||||
| Total recognised gains for the period | 12.9 | 7.9 | 7.0 | |||||
The accompanying notes to the accounts form an integral part of this statement.
BALANCE SHEET
30 September 2009
| At 30 September 2009 (unaudited) | At 30 September 2008 (unaudited) | At 31 March 2009 | ||||||
| Note | £m | £m | £m | |||||
| Fixed assets | 7 | 252.4 | 247.4 | 251.7 | ||||
| Investment - Loans to ultimate UK holding company | 68.5 | 68.5 | 68.5 | |||||
| Current assets | ||||||||
| Stocks | 1.0 | 1.0 | 1.1 | |||||
| Debtors | 25.3 | 25.5 | 21.6 | |||||
| Investments | 8 | 19.5 | 24.4 | 19.4 | ||||
| Cash at bank and in hand | 8 | 0.4 | 1.1 | 1.2 | ||||
| 46.2 | 52.0 | 43.3 | ||||||
| Creditors: amounts falling due within one year | ||||||||
| Short-term borrowings | 8 | (2.5) | (17.2) | (2.2) | ||||
| Ordinary dividends approved but not paid at period end | 12 | - | (3.2) | - | ||||
| Other creditors | (26.4) | (26.5) | (25.0) | |||||
| (28.9) | (46.9) | (27.2) | ||||||
| Net current assets | 17.3 | 5.1 | 16.1 | |||||
| Total assets less current liabilities | 338.2 | 321.0 | 336.3 | |||||
| Creditors: amounts falling due after more than one year | ||||||||
| Borrowings and derivatives | 8 | (214.2) | (205.7) | (220.2) | ||||
| Other creditors | (0.1) | (0.2) | (0.2) | |||||
| (214.3) | (205.9) | (220.4) | ||||||
| 8.75% irredeemable cumulative preference shares | 8 | (12.5) | (12.5) | (12.5) | ||||
| Deferred income | (10.2) | (10.2) | (10.2) | |||||
| Provision for liabilities | 9 | (25.0) | (20.7) | (22.8) | ||||
| Retirement benefit surplus | 10 | 8.3 | 10.0 | 6.3 | ||||
| Net assets | 84.5 | 81.7 | 76.7 | |||||
| Capital and reserves | ||||||||
| Called-up share capital | 6.0 | 6.0 | 6.0 | |||||
| Share premium | 4.4 | 4.4 | 4.4 | |||||
| Other reserves | 5.2 | 5.8 | 4.9 | |||||
| Profit and loss account | 68.9 | 65.5 | 61.4 | |||||
| Shareholders' funds | 11 | 84.5 | 81.7 | 76.7 | ||||
The accompanying notes to the accounts form an integral part of this statement.
CASH FLOW STATEMENT
For the six months ended 30 September 2009
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | ||||||
| Note | £m | £m | £m | |||||
| Net cash inflow from operating activities | 13 | 21.7 | 21.2 | 47.5 | ||||
| Returns on investments and servicing of finance | ||||||||
| Interest received | 2.2 | 2.6 | 5.1 | |||||
| Interest paid on term loans and debentures | (4.2) | (4.9) | (9.7) | |||||
| Interest paid on finance leases | (0.9) | (0.9) | (0.9) | |||||
| Dividends paid on 8.75% irredeemable cumulative | ||||||||
| preference shares | (0.5) | (0.5) | (1.1) | |||||
| (3.4) | (3.7) | (6.6) | ||||||
| Taxation | ||||||||
| Corporation tax paid | (0.7) | - | (2.1) | |||||
| Capital expenditure and investing activities | ||||||||
| Purchase of tangible fixed assets | (13.6) | (17.2) | (32.6) | |||||
| Contributions received | 2.4 | 2.1 | 3.6 | |||||
| Proceeds on sale of fixed assets | 0.2 | - | - | |||||
| (11.0) | (15.1) | (29.0) | ||||||
| Equity dividends paid | (5.1) | (1.5) | (8.8) | |||||
| Cash inflow before management of liquid resources | ||||||||
| and financing | 1.5 | 0.9 | 1.0 | |||||
| Management of liquid resources | ||||||||
| Being (increase) / decrease in short-term deposits | (0.1) | (3.1) | 1.9 | |||||
| Financing | ||||||||
| New term loans | - | 5.0 | 15.0 | |||||
| Capital element of lease repayments | (2.2) | (1.9) | (1.9) | |||||
| Loan repayments | - | - | (15.0) | |||||
| (2.2) | 3.1 | (1.9) | ||||||
| (Decrease) / increase in cash | 13 | (0.8) | 0.9 | 1.0 | ||||
| Cash, beginning of period | 1.2 | 0.2 | 0.2 | |||||
| Cash, end of period | 0.4 | 1.1 | 1.2 | |||||
The accompanying notes to the accounts form an integral part of this statement.
NOTES TO THE INTERIM RESULTS
For the six months ended 30 September 2009
| Note 1: | Accounting policies |
| The financial information contained in this interim announcement does not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006. The interim results, which have not been audited but have been reviewed by the company's auditors, have been prepared on the basis of the accounting policies adopted by Bristol Water plc for the year ended 31 March 2009 as set out in the Annual Report and Accounts. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditors' report on those accounts was not qualified and did not contain statements under s.237 (2) or (3) of the Companies Act 1985. As outlined in the company's Annual Report and Accounts for the year ended 31 March 2009, the company is not required to, and does not intend to, adopt IFRS until UK GAAP and IFRS are fully harmonised. The company has prepared the interim results on the going concern basis. The prospects of the company are discussed in the Chairman's Statement. |
| Note 2: | Turnover |
| Turnover is wholly derived from water supply and related activities in the United Kingdom. The maximum level of prices the company may levy for the majority of water charges is controlled by the Water Services Regulation Authority (Ofwat) through the RPI +/- K price formula. |
| Note 3: | Operating costs | |||||||
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | ||||||
| £m | £m | £m | ||||||
| Operating costs comprise - | ||||||||
| Payroll cost, net of recharges to fixed assets and including | ||||||||
| retirement benefit costs | 6.3 | 6.7 | 13.1 | |||||
| Depreciation, net of amortisation of deferred income | 10.0 | 10.5 | 20.3 | |||||
| Other operating costs | 18.6 | 16.7 | 34.2 | |||||
| 34.9 | 33.9 | 67.6 | ||||||
| Note 4: | Net interest payable and similar charges | |||||||
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2008 | ||||||
| £m | £m | £m | ||||||
| Other net interest (receivable)/payable and similar (income)/charges relate to - | ||||||||
| Bank borrowings | 0.4 | 1.4 | 2.3 | |||||
| Term loans and debentures - interest charges | 3.6 | 3.6 | 7.2 | |||||
| - indexation (credit)/charge | (3.1) | 1.7 | 5.0 | |||||
| Finance leases | 0.4 | 0.4 | 0.9 | |||||
| 1.3 | 7.1 | 15.4 | ||||||
| Less: | ||||||||
| Loan to Agbar UK Ltd (formerly Bristol Water Group Ltd) - interest receivable | (2.0) | (2.0) | (4.0) | |||||
| Other external investments and deposits | (0.1) | (0.7) | (1.0) | |||||
| (2.1) | (2.7) | (5.0) | ||||||
| Total other net interest (receivable)/payable and similar (income)/charges | (0.8) | 4.4 | 10.4 | |||||
| Dividends on 8.75% irredeemable cumulative preference | ||||||||
| shares | 0.5 | 0.5 | 1.1 | |||||
| Interest charge in respect of retirement benefit scheme | ||||||||
| surplus | 0.5 | 0.1 | 0.2 | |||||
| 0.2 | 5.0 | 11.7 | ||||||
| Note 5: | Tax on profit on ordinary activities | ||||||
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | |||||
| £m | £m | £m | |||||
| The charge for taxation comprises - | |||||||
| Current tax: | |||||||
| Corporation tax at 28% | 1.8 | 1.4 | 2.5 | ||||
| Adjustments to prior periods | - | - | (0.1) | ||||
| Total current tax | 1.8 | 1.4 | 2.4 | ||||
| Deferred tax: | |||||||
| Current period movement | 2.5 | 1.6 | 2.7 | ||||
| Adjustments to prior periods | - | - | 0.1 | ||||
| Effect of discounting | (0.3) | (1.2) | 0.1 | ||||
| Total deferred tax | 2.2 | 0.4 | 2.9 | ||||
| Total tax on profit on ordinary activities | 4.0 | 1.8 | 5.3 | ||||
| The overall tax charge represents 27% (six months to 30 September 2008: 18%; year ended 31 March 2009: 30%) of the profit before taxation. The deferred tax charge at 30 September 2008 is lower than the other comparative periods due to higher discount rates prevailing at that date. | |||||||
| Note 6: | Earnings per ordinary share | ||||||
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | |||||
| m | m | m | |||||
| Earnings per share have been calculated as follows - | |||||||
| Earnings | £10.7 | £8.2 | £12.1 | ||||
| Weighted average number of ordinary shares in issue | 6.0 | 6.0 | 6.0 | ||||
| Note 7: | Fixed assets | ||||||
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | |||||
| £m | £m | £m | |||||
| The movement in fixed assets comprises - | |||||||
| Net book value, beginning of period | 251.7 | 244.1 | 244.1 | ||||
| Additions | 13.0 | 15.7 | 31.3 | ||||
| Grants and contributions | (2.1) | (1.7) | (2.9) | ||||
| Depreciation charge for period | (10.2) | (10.7) | (20.8) | ||||
| Net book value, end of period | 252.4 | 247.4 | 251.7 | ||||
| Note 8: | Net borrowings | |||||||
| At 30 September 2009 (unaudited) | At 30 September 2008 (unaudited) | At 31 March 2009 | ||||||
| £m | £m | £m | ||||||
| Net borrowings comprise - | ||||||||
| Debt due after one year, excluding 8.75% | ||||||||
| irredeemable cumulative preference shares | 214.2 | 205.7 | 220.2 | |||||
| Current portion of debt | 2.5 | 2.2 | 2.2 | |||||
| Current portion of bank loans | - | 15.0 | - | |||||
| 216.7 | 222.9 | 222.4 | ||||||
| Cash balances and investments | (19.9) | (25.5) | (20.6) | |||||
| Net borrowings excluding 8.75% irredeemable | ||||||||
| cumulative preference shares | 196.8 | 197.4 | 201.8 | |||||
| 8.75% irredeemable cumulative preference shares | 12.5 | 12.5 | 12.5 | |||||
| Net borrowings | 209.3 | 209.9 | 214.3 | |||||
| Note 9: | Provision for liabilities | |||||||
| At 30 September 2009 (unaudited) | At 30 September 2008 (unaudited) | At 31 March 2009 | ||||||
| £m | £m | £m | ||||||
| Deferred tax liability | 43.0 | 39.8 | 39.7 | |||||
| Effect of discounting | (14.8) | (15.2) | (14.5) | |||||
| Net provision, including deferred tax on retirement | ||||||||
| obligations | 28.2 | 24.6 | 25.2 | |||||
| Less, | ||||||||
| attributable to retirement benefit obligations (note 10) | (3.2) | (3.9) | (2.4) | |||||
| Net provision, excluding deferred tax on retirement | ||||||||
| benefit obligations | 25.0 | 20.7 | 22.8 | |||||
| Note 10: | Retirement benefits |
| Pension arrangements for the majority of the company's employees are provided through the company's membership of the Water Companies' Pension Scheme (WCPS), which provides defined benefits based on final pensionable pay. The company's membership of WCPS is through a separate section of the scheme. The assets of the section are held separately from those of the company and are invested by discretionary fund managers appointed by the trustees of the scheme. The section has been closed to new entrants and all new eligible employees are offered membership of a stakeholder pension scheme. In addition to providing benefits to employees and ex-employees of Bristol Water plc, the section provides benefits to employees and ex-employees of Bristol Water Holdings Limited and former Bristol Water plc employees who transferred to Bristol Wessex Billing Services Ltd. The majority of the section assets and liabilities relate to Bristol Water plc employees and ex-employees. In 2005/06, in connection with new financing and the return to shareholders by the then ultimate parent company, the company made a one-off contribution to WCPS of £7.0m. The company also agreed to make additional contributions of £1.0m in each of the four years beginning 1 April 2006 and a further £0.9m in 2010/11. The amounts are in addition to the normal pension contributions required by the WCPS trustees. In accordance with FRS 17 actuarial gains and losses are recognised immediately in the Statement of Total Recognised Gains and Losses. |
| In summary assets and liabilities under FRS 17 were: | ||||||||||||||
| 30 September 2009 (unaudited) £m | 30 September 2008 (unaudited) £m | 31 March 2009 £m | ||||||||||||
| Market value of section assets | 137.2 | 133.1 | 123.8 | |||||||||||
| Present value of liabilities | (125.7) | (118.5) | (106.2) | |||||||||||
| Surplus in the section | 11.5 | 14.6 | 17.6 | |||||||||||
| Restriction of surplus due to asset limit under FRS 17 | - | (0.7) | (8.9) | |||||||||||
| 11.5 | 13.9 | 8.7 | ||||||||||||
| Deferred taxation | (3.2) | (3.9) | (2.4) | |||||||||||
| Net retirement benefit surplus | 8.3 | 10.0 | 6.3 | |||||||||||
| Note 11: | Shareholders' funds | |||||||||||||
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | ||||||||||||
| £m | £m | £m | ||||||||||||
| Movement in shareholders' funds - | ||||||||||||||
| At beginning of period | 76.7 | 78.5 | 78.5 | |||||||||||
| Profit for the period | 10.7 | 8.2 | 12.1 | |||||||||||
| Actuarial gains/(losses) recognised in respect of | ||||||||||||||
| retirement benefit obligations | 2.6 | (0.4) | (5.8) | |||||||||||
| Attributable deferred taxation | (0.7) | 0.1 | 1.6 | |||||||||||
| Fair value of interest rate swap | 0.4 | - | (1.2) | |||||||||||
| Attributable deferred taxation | (0.1) | - | 0.3 | |||||||||||
| Ordinary dividends (note 12) | (5.1) | (4.7) | (8.8) | |||||||||||
| End of period | 84.5 | 81.7 | 76.7 | |||||||||||
| Note 12: | Ordinary dividends | |||||||||||||
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | ||||||||||||
| £m | £m | £m | ||||||||||||
| Dividends in respect of 2007/08: | ||||||||||||||
| Final dividend of 53.35 pence per share, | ||||||||||||||
| approved by the Board on 4 August 2008 | - | 3.2 | 3.2 | |||||||||||
| Dividends in respect of 2008/09: | ||||||||||||||
| First interim dividend of 24.27 pence per share, | ||||||||||||||
| approved by the Board on 26 September 2008 | - | 1.5 | 1.5 | |||||||||||
|
Second interim dividend of 45.02 pence per share, | ||||||||||||||
| approved by the Board on 24 November 2008 | - | - | 2.7 | |||||||||||
|
Third interim dividend of 24.14 pence per share, | ||||||||||||||
| approved by the Board on 30 March 2009 | - | - | 1.4 | |||||||||||
|
Final dividend of 60.02 pence per share, approved | ||||||||||||||
| by the Board on 3 August 2009 | 3.6 | - | -
| |||||||||||
| Dividends in respect of 2009/10: | ||||||||||||||
| First interim dividend of 24.27 pence per share, | ||||||||||||||
| approved by the Board on 28 September 2009 | 1.5 | - | - | |||||||||||
|
| ||||||||||||||
| 5.1 |
| 4.7 | 8.8 | |||||||||||
| A second interim ordinary dividend for 2009/10 of 61.69 pence per share totalling £3.7m was approved by the Board on 11 November 2009 and will be paid subsequently. In accordance with Financial Reporting Standard 21 "Events after the balance sheet date" this amount has not been provided for in these interim financial statements. |
| Note 13: | Supplementary cash flow information | ||||||||
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | |||||||
| £m | £m | £m | |||||||
| a) | Reconciliation of operating profit to net cash inflow from operating activities - | ||||||||
| Operating profit | 14.9 | 15.0 | 29.1 | ||||||
| Depreciation, net of amortisation of deferred | |||||||||
| income | 10.0 | 10.5 | 20.3 | ||||||
| Difference between pension charges and normal | |||||||||
| contributions | (0.2) | 0.2 | 0.2 | ||||||
| Cash flow from operations | 24.7 | 25.7 | 49.6 | ||||||
| Working capital movements: | |||||||||
| Stocks | - | (0.1) | (0.2) | ||||||
| Debtors | (3.7) | (4.4) | (0.7) | ||||||
| Creditors and provisions | 1.2 | 0.5 | (0.2) | ||||||
| Additional contributions to pension scheme | (0.5) | (0.5) | (1.0) | ||||||
| Net cash inflow from operating activities | 21.7 | 21.2 | 47.5 | ||||||
| Six months to 30 September 2009 (unaudited) | Six months to 30 September 2008 (unaudited) | Year to 31 March 2009 | |||||||
| £m | £m | £m | |||||||
| b) | Reconciliation of net cash flow to movement in net borrowings - | ||||||||
| (Decrease)/increase in net cash in the period | (0.8) | 0.9 | 1.0 | ||||||
| Cash used to repay borrowings | 2.2 | 1.9 | 16.9 | ||||||
| Cash from new borrowings | - | (5.0) | (15.0) | ||||||
| Cash from decrease in short-term deposits | 0.1 | 3.1 | (1.9) | ||||||
| Decrease in net borrowings | 1.5 | 0.9 | 1.0 | ||||||
| Indexation not affecting cash flow | 3.1 | (1.7) | (5.0) | ||||||
| Fair value of interest rate swap not affecting cash | |||||||||
| flow | 0.4 | - | (1.2) | ||||||
| Net borrowings, beginning of period, including | |||||||||
| 8.75% irredeemable cumulative preference | |||||||||
| shares | (214.3) | (209.1) | (209.1) | ||||||
| Net borrowings, end of period, including 8.75% | |||||||||
| irredeemable cumulative preference shares | (209.3) | (209.9) | (214.3) | ||||||
| Note 14: | Ultimate parent company and controlling party |
| At 30 September 2009 the ultimate UK parent and controlling company was Agbar UK Ltd (formerly Bristol Water Group Ltd). The ultimate parent company is believed by the Directors to be Sociedad General de Aguas de Barcelona S.A. (Agbar), a company incorporated in Spain. In October 2009 it was announced that Suez Environment (partly owned by the French group GDF Suez) planned to take 75% control of Agbar, subject to shareholder and regulatory approvals. The outcome may change the identity of Bristol Water plc's ultimate parent company, which is currently considered to be Agbar for the purposes of Condition P of the company's Instrument of Appointment. Ofwat is being kept informed of material developments. |
| Note 15: | Circulation |
| This interim announcement is being sent to all shareholders and debenture holders. Copies are available to the public from the company's registered office at PO Box 218, Bridgwater Road, Bristol, BS99 7AU and on the Bristol Water web site: http://www.bristolwater.co.uk. |
DIRECTORS' RESPONSIBILITIES FOR THE PREPARATION OF INTERIM FINANCIAL STATEMENTS
We confirm that to the best of our knowledge:
These interim financial statements have been prepared in accordance with UK GAAP;
The Chairman's statement includes a fair review of the information required to indicate important events during the first six months of the financial year and their impact on the interim financial statements, and a description of the principal risks and uncertainties for the remaining six months of the financial year.
By order of the Board
S C Robson
Secretary
11 November 2009
INDEPENDENT REVIEW REPORT TO BRISTOL WATER PLC
We have been engaged by the company to review the financial statements in the half-yearly financial report for the six months ended 30 September 2009 which comprises the profit and loss account, the statement of total recognised gains and losses, the balance sheet, the cash flow statement and related notes 1 to 15. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the financial statements.
This report is made solely to the company in accordance with International Standard on Review Engagements 2410 issued by the Auditing Practices Board. Our work has been undertaken so that we might state to the company those matters we are required to state to them in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our review work, for this report, or for the conclusions we have formed.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.
As disclosed in note 1, the annual financial statements of the company are prepared in accordance with United Kingdom Generally Accepted Accounting Practice. The condensed set of financial statements included in this half-yearly financial report have been prepared in accordance with the accounting policies the company intends to use in preparing its next annual financial statements.
Our responsibility
Our responsibility is to express to the company a conclusion on the financial statements in the half-yearly financial report based on our review.
Scope of Review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the financial statements in the half-yearly financial report for the six months ended 30 September 2009 is not prepared, in all material respects, in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.
Deloitte LLP
Chartered Accountants and Registered Auditor
11 November 2009
Bristol, United Kingdom