Bristol Wtr.8t% Regulatory News (BWRA)

31 Mar 2006 12:10

Bristol Water PLC31 March 2006 Bristol Water plc Trading update Bristol Water plc notes the announcement made today by Bristol Water Group plc,the text of which is set out below. Bristol Water Group plc Trading update Ahead of entering its close period, the Board of Bristol Water Group plc (the'Group') provides the following update. The Board plans to announce the Group'spreliminary results for the year ended 31 March 2006 on 25 May. Having completed its disposal of all material non-regulated activities, theGroup is now focused on its regulated water business. The regulated water business is just completing the first year of the newregulatory period covering the five years to 2010 and is making good progresstowards delivery of the required outputs and efficiency targets specified byOfwat in its determination of the new price limits. A major focus during the year has been the planning and initiation of a numberof major capital schemes and the establishment of a framework partnershipagreement to deliver them. Good progress is being made with the major capitalexpenditure project to improve the security of supply for customers in thenorthern part of our area. Capital expenditure for the year ended 31 March 2006will be lower than Ofwat's assumptions due to the phasing of the expenditure. Inreal terms over the five-year period the Group anticipates spending in line withOfwat's assumptions. Approximately 40% of the Group's water resources come from impoundingreservoirs. These are currently approaching 90% full and no restrictions onwater use are expected in the coming year. The agreement for the sale of Lawrence (the Group's previous contractingsubsidiary) provided for the payment of deferred consideration to the Groupdependent on the award of certain contracts to Lawrence. The first of these hasbeen awarded and work commenced triggering the entitlement to £2.2 millionpayable in instalments over the next two years. There is the potential for afurther £0.8 million consideration dependent upon a further contract award. The Group retained liability in respect of the defined benefit pension schemefor its previous non-regulated businesses. At 30 September 2005, on an IAS19basis, the scheme had a small deficit of approximately £0.1million. The Group isconsidering a buy out of the liability and is investigating the cost withinsurance companies. Accordingly the Group may make an additional provision forthe buy out costs in the full year results. The Group is today making a £2m cashpayment into the non-regulated section of the Group's pension scheme. The Group adopted Internal Financial Reporting Standards (IFRS) for itsconsolidated interim accounts. As explained in the Group's IFRS transitionalstatement and interim accounts, IFRS and their interpretation continue to evolvealongside industry practice. The Group plans to review the basis of adoption ofIFRS for its full year accounts. As previously stated, adoption of IFRS at aconsolidated level has no cash impact nor does it affect dividend payingcapacity. As previously announced, after 37 years of service to the group, Roger Wyatt,managing director of the regulated water business retires today. His role isbeing absorbed by Alan Parsons (Chief Executive) and Andy Nield (Group FinanceDirector)" For further information contact: Alan Parsons, ChairmanAndy Nield, Finance DirectorTel 0117 953 6407 This information is provided by RNS The company news service from the London Stock Exchange