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Pennon announces preliminary results

20th May 2015

Today (20 May) Pennon released its unaudited results for the financial year ended 31 March 2015.

Viridor Chief Executive, Ian McAulay joined the Pennon Chairman to share the Pennon Group preliminary results with the City at 11.00am. During his presentation Ian spoke about how Viridor has passed the strategic point of inflexion with the company operating strongly with the new strategic orientation of the business around our Energy and Recycling & Resources divisions. The ERF business is now operational with 5 new ERFs delivered, adding to the existing Lakeside and Bolton operational facilities.

The Landfill Energy operation continues to provide an important cash contribution to the business, aligned with the search for alternative uses for the asset base. Viridor is well positioned for growth in a consolidating recycling sector, with the Collections fleet securing vital materials for recycling facilities and ERFs, supported by further procurement of material, including the Borough of Poole and Kent County Council contract wins.

Speaking of the results, Pennon Group Chairman Ken Harvey said:

“The Group has delivered a resilient set of results for 2014/15. South West Water’s EBITDA was higher than last year despite the tariff freeze, thanks to a strong focus on cost efficiency, and as expected Viridor’s EBITDA exceeded last year. Viridor has made excellent progress in its Energy business bringing five new Energy Recovery Facilities on stream in the year. Pennon is well positioned to continue to deliver profitable growth and consistent, sustainable cash returns to shareholders. The Board was pleased to announce in March the continuation of the current dividend policy, targeting 4% year-on-year growth above RPI inflation to 2020.”

Financial highlights include:

  • Revenue up by +2.7% to £1,357.2m
    • South West Water up +0.1% to £331.3m, despite 2014/15 tariff freeze thanks to continued cost efficiency
    • Viridor EBITDA up +5.4% to £80.4m, with Energy Recovery Facilities (ERFs) contributing significantly
  • Profit before tax up +1.6% to £210.7m
    • South West Water up +3.3% to £167.9m
    • Viridor up +0.4% to £27.7m
  • Net exceptional post-tax charge of £11.0m
  • Impairment of a small number of landfill sites, and underperforming contracts, partly offset by a reduction in environmental provisions and reduced retirement benefit obligations following pension scheme benefit changes
  • Earnings per share down (6.6%) to 39.8p reflecting underlying impact of tariff freeze, which will be recovered on an NPV neutral basis over 2015 – 2020
  • Full year dividend up +4.9% to 31.80p policy of 4% year-on-year dividend growth over RPI inflation to continue to 2020.

To download the preliminary results click here.

 

Presentation of Results:

A presentation for City audiences will be held today, Wednesday, 20 May 2015, at 11am at Vintners’ Hall, 68 Upper Thames Street, London, EC4V 3BG.

A live webcast of the presentation can also be accessed using the following link:
pennon-group.co.uk/investor-information/financial-reports-and-presentations.

 

For further information, please contact:

Susan Davy, Group Director of Finance – Pennon

01392 443 401

Sarah Heald, Head of Investor Relations – Pennon

01392 443 401

James Murgatroyd, Finsbury

0207 251 3801

 

About Pennon:

Pennon Group Plc is an environmental utility infrastructure company, which owns South West Water Limited and Viridor Limited. The Group has assets of over £5 billion and a workforce of over 4,500 people.

South West Water provides water and sewerage services to a population of approximately 1.7 million in Devon and Cornwall and parts of Dorset and Somerset.

Viridor is one of the leading UK renewable energy, recycling and waste management companies providing services to local authorities and businesses across the UK. Its strategy is focused on transforming waste, using input materials to produce vital renewable energy, high quality recyclates and raw materials.

On 15 April 2015, Pennon Group acquired Bournemouth Water from Sembcorp Holdings Limited. Bournemouth Water provides water services to a population of approximately 440,000 people in the Bournemouth and Christchurch region.

Further information on Pennon can also be found on the Group’s website, www.pennon-group.co.uk

For further information please contact:

pressoffice@pennon-group.co.uk