United Utilities, the north west of England water company, says increases in revenue will not filter through into significantly higher profits.
In a management statement covering the period between April 1st and July 26th the company says while revenues have increased, this will be "largely offset by higher depreciation ... and higher levels of infrastructure renewals expenditure and other operating costs".
The firm still expects to meet its profit targets over the regulated period between 2010 and 2015.
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The statement also says United has paid £50m of a previously agreed pension deficit payment earlier than first thought, reflecting a strong underlying financing position.
Net debt now stands at around £146m and United has vowed to continue paying dividends at 2% above the Retail Prices Index.
BS
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