LONDON (dpa-AFX) - Pennon Group plc (PNN.L), an environmental infrastructure group, Tuesday said it is on track to deliver resilient financial results for fiscal 2021, in line with management expectations. The shares were losing around 3 percent in the early morning trading in London.
In its trading update for the full year ending March 31, 2021, the company said South West Water is on track to deliver strong totex and financing outperformance, anticipating a doubling of base returns on regulated equity or RORE of 3.9 percent.
The company noted that there was a net increase in demand and associated revenues during the second half as increased household demand has more than offset a decline in non-household demand driven by COVID-19 related restrictions.
Further, the company said South West Water's Green Recovery Initiative could see investment to 2025 increasing by 92 million pounds, about 10 percent increase to its existing 1 billion pounds investment programme.
The investment would result in about 3 percent RCV increase, supporting a sustainable future and the creation of up to 500 additional jobs across the region.
Pennon Water Services, its business to business water retailer, continues to win new contracts, partially offsetting reduced demand.
The company said it remains in a strong financial position with expected cash and committed facilities well in excess of 3 billion pounds at March 31, 2021.
Pennon said it 'believes there is significant value potential from the reinvestment of the Viridor sale proceeds in the UK water sector and continues to narrow down its review of potential growth opportunities. In the event a major value accretive investment opportunity is not available, Pennon expects to make a substantial return of capital to shareholders.'
The company is scheduled to release full-year results on June 3.
In London, Pennon shares were trading at 961.60 pence, down 3.2 percent.
Copyright RTT News/dpa-AFX