Non-regulated

We operate utility assets on behalf of other businesses in the UK and overseas and hold major contracts with Dwr Cymru Welsh Water, Southern Water, Scottish Water and Northern Gas Networks. As a partner in the Scottish Water Solutions consortium, we have a principal role in delivering the company’s £1.1 billion four-year capital investment programme and we recently extended our contract with Southern Water to March 2015. In 2007, we added to our portfolio by securing the £1.5 billion contract to manage the electricity distribution assets for the new owners, Electricity North West.

We also operate contracts in Bulgaria, Estonia, Poland, the Philippines and Australia. In addition, we have a meter installation contract with British Gas Trading which, earlier this year,  was extended to 2010.

Revenue increased by 30.2 per cent to £949 million compared with the previous year. Underlying operating profit was also slightly higher. This reflects the first time the contribution from our electricity contract has been included. Reported operating profit was down 19.2 per cent compared with 2006/07 due to £12 million of restructuring costs.

We plan to grow our business in future by focusing on opportunities in four key target markets: UK utilities, UK municipal solid waste treatment, the Gulf region and Australia, applying our core skills on an asset-light basis where we identify opportunities to generate additional shareholder value with little impact on the risk profile of the group.