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United Utilities says current trading in line with expectations but annual profits to be impacted by costs relating to dry summer of 2018

In a trading update, the FTSE 100-listed water firm said it will book exceptional items of £52mln for its year ending 31 March, of which £29mln was recognised in its interim results
Water games
United Utilities expects its full-year underlying operating profit and revenue to be higher than a year earlier

United Utilities Group PLC (LON:UU.) said its current trading is in line with expectations although its reported operating profit will be impacted by costs relating to the "exceptional" period of dry weather during the summer of 2018, coupled with pension and restructuring costs.

In a trading update, the FTSE 100-listed water firm said it will book exceptional items of £52mln for its year ending 31 March, of which £29mln was recognised in its interim results.

READ: United Utilities downgraded to ‘hold’ from ‘buy’ by Deutsche Bank on valuation grounds

On an underlying basis, the group said it expects its full-year operating profit to be higher than a year earlier, while revenue is expected also to be higher than last year, largely reflecting allowed regulatory revenue changes.

United Utilities said its finance expenses are expected to fall by around £45mln, while net debt will rise slightly from September 30 due to investment.

However, the group said its balance sheet is "strong", with gearing well within its 55% to 65% target range.

United Utilities also said it is "pleased" to have been given fast-track status by UK regulator Ofwat regarding its 2020 to 2025 business plan, getting the "highest grades" overall.

In early morning trading, shares in United Utilities were 1.2% to 847.20p.

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