Northumbrian Water in £150m loan plan talks

Jul 30 2010 by Karen Dent, The Journal

NORTHUMBRIAN Water says it is trading in line with expectations and is now at an advanced stage in its discussions with the European Investment Bank for a new loan facility of £150m.

The Durham-based group, which also owns Essex & Suffolk Water, said the discussions with the bank – a major lender to the utility sector – were for funding for its asset management plan over the next five years and the talks were business as usual.

Northumbrian said it expects its operating costs for the current financial year to increase by around 4% on the back of increased costs such as rates and pensions. However, it has made savings on energy prices.

Northumbrian has already announced that household water bills are expected to increase by an average of £14 in the next five years. For 2010/11, charges increased by 5.3%.

Northumbrian gave the update to shareholders at its annual general meeting yesterday. It plans to award an annual dividend of 13.24p to all shareholders on the register by August 13.

Northumbrian’s half-yearly results for the six months ending September 30 will be published on November 30.

The group’s annual turnover was £704.7m in the year to the end of March, while pre-tax profits stood at £275.8m.