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TIDM53HO
RNS Number : 2623Z
South East Water Limited
14 December 2017
South East Water Limited
Condensed group financial statements
for the six months ended 30 September 2017
Registered number 02679874
Contents Chairman's introduction Statement of directors' responsibilities Condensed group income statement Condensed group statement of comprehensive income Condensed group statement of financial position Condensed group statement of changes in equity Condensed group statement of cash flows Notes to the condensed group financial statements
Chairman's introduction
I am pleased to present our interim report for the first half of the 2017/18 financial year.
We have reached the half-way mark of our five year business plan, a plan which put customer satisfaction at the heart of everything we do. We do this by working with our customers and communities, sharing ideas and working together to innovate in ensuring we provide a reliable and economic high quality drinking water service, while enhancing the environment and benefiting society through our work.
A review of the year
Our vision is to be the water company people want to be supplied by and want to work for. The report by the Consumer Council for Water in September this year recognised our continuous improvement in customer service and highlighted our commitment to getting things right first time for customers. Some of the innovative initiatives which have helped us achieve this success include:
-- increased digital communications such as 'My Account' (with 50,000 customers signed up by August 2017) and an online 'in your area' map showing supply updates;
-- improved technology to help resolve customer queries, such as ensuring we have dedicated employees available to support social media and live chat channels via our website;
-- encouraging ideas from employees and acting on feedback through our 'Pipe Up' ideas forum and employee workshops.
We will continue to engage with customers and community groups with the objective of delivering a five-star service for all. For example our popular open days give customers a chance to see behind the scenes at our water treatment works and raise questions and suggestions that we feed back into the business. This commitment to listening to customers is demonstrated by the fact we are on track to see complaints reduce for a seventh consecutive year, with complaints for the period to 30 September 2017 down by 21 per cent.
One area where we have worked particularly hard to ensure a positive customer experience is in our customer metering programme. We have installed a further 21,323 water meters in the first six months of the year. The metering team has recently been shortlisted as "Team of the Year" at the Utility Week Awards, which endorses their efforts to ensure a smooth transition to metered water for customers.
We now have 84 per cent of our customers on meters and are on track to achieve 90 per cent by 2020, as set out in our long term water resources strategy.
We strive to keep improving the quality of the water we supply. While we have maintained high overall water quality with 99.95 per cent of samples passing standards set (as this is calculated on a calendar year basis this is the figure from January to September 2017), we want to reduce the number of calls we receive about discoloured water. In order to do this we are carrying out a pipe flushing programme in the order of approximately 900 miles during the year.
It is important that customers have trust in the quality of the information we provide and we continue to work hard to ensure our reporting is not only robust and transparent, but also clear and engaging for readers. Our regulator Ofwat has, for a second year, recognised our work in this area and assessed the quality of the information and assurance as industry leading.
We have our largest environmental programme of work taking place during this five year period through the Water Industry National Environment Programme (WINEP). Work includes catchment management education programme and practical projects with farmers to help them reduce pesticide runoff into rivers. This work is carried out in partnership with Natural England and we are grateful for the addition of their expertise to support this programme.
Eels are a protected species and can be damaged through our treatment works if special screens are not in place. As part of the WINEP we have had sign off for one of our eel screens at Bray and we have commenced the design of five more screens. In the last six months a screen at Crowhurst Bridge has been constructed and we expect two others to be constructed this year.
Another environmental success, with Natural England and also Bug Life, is that our dedication to improving wildlife habitats has seen the successful reintroduction of rare wart-biter crickets to our land at Deep Dean in East Sussex. Careful management of the land above our chalk aquifers not only ensures we are protecting the water quality below the ground, but we are also benefiting the biodiversity above ground too.
The start to this year's recharge season has been drier than average in the south east, with October receiving just 40 per cent long term average rainfall. As such we have been preparing in case there is a second consecutive dry winter. At this point, our reservoirs are in a good position, but we need above average winter rainfall to refill the underground sources. We will continue to monitor and manage supplies through the winter and work closely with customers to promote water efficiency in preparation for the spring/ summer 2018.
This year we are updating our long-term water resource plans. We will begin a 12 week public consultation early in 2018 on our new draft water resources management plan, which has been prepared to ensure we have a resilient water supply through to 2080. In order to plan this far ahead we have worked closely with a number of key stakeholders to develop the plan through our Environment Focus Group and, as active members of the Water Resources in the South East (WRSE) group, with our neighbouring water companies as we work together to look to develop optimal regional solutions.
Results and key financial performance indicators
The results published in this statement summarise our performance for the period to 30 September 2017. The financial statements are prepared under International Financial Reporting Standards ("IFRS") and incorporate the performance of South East Water Limited and our subsidiary, South East Water (Finance) Limited.
Revenue for the period was GBP114.5 million compared with GBP111.0 million for the same period in the previous year. The increased revenue is largely due to the numbers of new properties in the area and the increase in prices averaging 4.86 per cent for the year. This is partially offset by lower consumption of approximately 3.87 per cent due to the cooler and wetter than average summer and the impact of metering on billing.
Net operating costs for the period to 30 September 2017 were GBP79.0 million, which is some GBP6.1 million higher than the corresponding period last year. The higher costs are mainly due to a 30 per cent increase in business rates (GBP2.3 million), increased depreciation due to the continued high investment in the company's assets (GBP1.6 million), higher contractor and staff costs due to reactive maintenance (including mains bursts) of the network (GBP0.9 million) and increased energy costs of GBP0.2 million.
Operating profit was GBP39.3 million for the period to 30 September 2017 which compares with GBP42.0 million in the prior year. Operating profit as a percentage of revenue has decreased from 37.9 per cent in the first half of 2016/17 to 34.3 per cent in the current year.
Finance costs have increased by GBP4.1 million from GBP22.9 million to GBP27.0 million. This reflects the higher RPI being applied to the index linked loans and bonds during the period to 30 September 2017.
Profit before tax was GBP14.7 million compared with GBP21.8 million for the same period last year. This represents 12.8 per cent of revenue compared with 19.7 per cent for the corresponding period last year.
Deferred tax for the same period in 2016/17 was significantly affected by the changes in future tax rates announced in that year. This resulted in a tax credit of GBP3.6 million. There have been no new adjustments to the headline rate of corporation tax announced in the same period in 2017/18. Therefore, the company has incurred a tax charge of GBP1.7 million for the period to 30 September 2017, being GBP1.0 million of current tax on our ordinary operations and GBP0.7 million of deferred tax due to taxation timing differences.
As a result of the above, profit after tax has decreased from GBP25.4 million to GBP13.0 million for the first six months of the year.
Net cash generated from operations was GBP64.5 million for the period to 30 September 2017 compared to GBP62.9 million in the same period for the previous year. Also, during the period the company drew down GBP15.0 million from our committed loan facilities to ensure the capital programme could be maintained in line with the plans submitted to our regulators.
The interest paid in the year is significantly less than the previous year due to the timing of interest payments on our listed bonds.
We continue to comply with the financial covenants set out in our securitisation structure and continue to hold ratings from Moody's and Standard & Poor's consistent with the requirements of both our securitisation and our instrument of appointment.
Investing in customer satisfaction
We are the only water company which elected to include customer satisfaction measures with potential financial penalties and rewards within our five year performance commitments. It is important for us to make sure we were hearing from all our customers - including the silent majority - and therefore every month we survey a random selection of customers to ask how satisfied they are with the service we provide.
Across the business, initiatives have been running to keep improving customer satisfaction and for the second year our scores have improved. The period to 30 September 2017 saw an average of 75.57 per cent of customers surveyed say they are either satisfied or very satisfied with the service we provide. This compares to an average score of 74.76 per cent in the same period of 2016/17. In particular we have been focused on improving customer satisfaction with leakage and are pleased to say this has increased to an average of 3.9 out of five for the six month period, close to our target of 4.0.
We are delighted that our service incentive mechanism qualitative score has been an average of 4.33 out of 5.00 for the period to 30 September 2017 compared to 4.19 in the first half of 2016/17. One area of considerable improvement for our customers this year is our joint initiative with Southern Water for us to bill on their behalf for wastewater services, giving our customers the convenience of just one bill - something customers have asked for. Since this was agreed we have transferred more than 324,000 customers (to the end of November 2017) to the new joint billing approach, with the remainder due to move by April 2018.
We are on track with our planned capital investment programme of GBP83.9 million for the year 2017/18. For the period to 30 September 2017 we have invested GBP43.0 million on maintaining and improving our network of pipes, treatment works, metering and other key areas.
Our largest capital scheme during this five year investment programme is the extension of our water treatment works at Bray, Berkshire. The site is currently capable of treating up to 45 million litres of fresh drinking water per day and we plan to extend the works to be able to treat up to 68 million litres per day in order to secure water supplies for current and future customers across Berkshire, Surrey and Hampshire. The scheme was submitted for planning permission in November 2017.
Our purpose built laboratory in Farnborough has tested more than 100,000 samples in the first six months of the year. Along with supporting our own water sampling programme, the UKAS accredited laboratory provides a service to more than 200 other businesses and organisations, from other water companies and local authorities through to individual private supplies.
One of our customer commitments is to keep interruptions to customer supplies to a minimum. Our underlying performance has been good and most customers who have suffered an interruption have had their water restored in under three hours, leading to an average interruption time across our whole customer base of 3.9 minutes per property for the period to 30 September 2017. Our target for the full year is to remain below 12 minutes per property.
We have launched an "in your area" map on our website that allows customers to quickly find out about any work or supply interruptions in their area. Simply entering a postcode allows you to zoom to an area of the map and find information about anything from planned roadworks to reported leaks. Customers can then sign up for email or text alerts to keep them updated on work that interests them. This online information is proving popular and between April and September we have sent more than 4,400 emails and 4,600 SMS text messages to help keep customers informed about our work.
This is just one of the ways we try to keep all our customers informed when we are working in their area. We also have our priority services register where people can sign up for special assistance, such as delivery of bottled water. We now have 16,708 customers on our register (at the end of September 2017) - an increase of just over 1,000 in the last six months.
Our Customer Care Team works in partnership with many organisations including other utilities to identify those customers who may need extra support whether that be through information we provide or if they have difficulty paying their water bills. The team sensitively talks through their situation to understand their circumstances and find the right tariff and payment options for them.
At the end of September 2017 we had more than 12,500 customers now signed up to our Social Tariff helping ensure their bills are affordable.
The business retail market opens
On the 1 April 2017 we, along with the other water companies nationally, were ready for the opening of a new retail market for non-household customers. We welcomed the challenge and continue to work hard to ensure the new market is successful. Our dedicated Wholesale Service Desk is working closely with the new retailers to ensure a smooth transition and that the non-household customers continue to receive an excellent and reliable service.
South East Water Choice, our non-household retail business, has had a successful first six months with most of our business customers opting to stay and many choosing to now get both their water and wastewater services from us.
Our sister company Water Choice, which is part of our group, has also been offering water and wastewater retail services to all business customers across England since market opening.
Our next step is to bring all our retail activities under one roof. From 1 April 2018 all our water and sewerage retail business will be undertaken by Water Choice. This will simplify our operations, and help us provide a more efficient service and an improved customer experience.
An application has been submitted to the Secretary of State for the Department for Environment, Food and Rural Affairs (Defra) and if given the go ahead the transition is planned to take place on 1 April 2018.
We will keep our customers fully informed along the way and maintain the best level of service to our customers through our knowledgeable and experienced team.
You can find out more about the new business retail market itself at open-water.org.uk.
Principal risks and uncertainties
The principle risks and uncertainties facing the business are set out in the Strategic Report within the group's Annual Report for the financial year 2016/17, which can be found on the South East Water website.
Going concern
The directors are satisfied that the group has sufficient resources to continue in operation for the foreseeable future; a period of not less than 12 months from the date of this report.
Looking ahead
This year is a particularly important one as we prepare and consult on our long term plans. Along with our water resources management plan, we are preparing our business plan for the period 2020-2025 and will publish this in September 2018.
We have been working closely with our Customer Challenge Group (CCG), and engaging widely with customers and our communities to help us develop a plan that ensures everything we do reflects all of the many different people we serve and meets the needs of our customers, communities and the environment.
As a business that ensures there is a reliable supply of quality water for the south east of England, we know we have a potentially significant impact on society. We intend for our plan to be one that ensures we are building a future that puts the environment, society and the next generation at the forefront.
I would like to take the opportunity to thank Zoe Mcleod who chairs our CCG and all the members of the group who are giving us a strong challenge to ensure we develop a plan that truly makes customer engagement part of who we are at South East Water.
The board is excited by the future direction that we can see developing through our conversations with customers and stakeholders. There is real appetite for us to see South East Water recognised as a leading business in customer engagement, not just in the water industry, but to be an example for other industries too.
We know that it is the employees and business partners at South East Water and their dedication and passion for our vision that has helped us continue to improve as they keep aiming for five-out-of-five service for every one of our customers. On behalf of the board I would like to thank everyone involved. We look forward to the rest of this year and through 2018 as we work with our customers to develop a sustainable future for water in our community of the south east.
Nick Salmon
Chairman
14 December 2017
Statement of directors' responsibilities
The directors confirm that to the best of their knowledge:
-- the condensed group financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as endorsed by the European Union; and
-- the condensed group statements herein include a fair review of the information required by the Disclosure and Transparency Rules 4.2.7R.
The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the group and enable them to ensure that the group financial statements comply with the Companies Act 2006. They are responsible for safeguarding the assets of the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The directors are also responsible for the maintenance and integrity of the corporate and financial information included on the company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
Paul Butler
Managing Director
14 December 2017
Condensed group income statement
for the six months ended 30 September 2017
Six months Six months ended ended 30 September 30 September 2017 2016 Notes GBP000 GBP000 Revenue 3 114,450 110,990 Group net operating costs 5 (79,009) (72,890) Other income 3 3,840 3,939 Group operating profit 39,281 42,039 Finance costs 6 (26,957) (22,882) Finance income 7 2,349 2,686 Profit before taxation 14,673 21,843 Taxation 8 (1,662) 3,596 -------------- ----------------------- Profit for the period 13,011 25,439 -------------- ----------------------- Earnings per share Basic and diluted from continuing operations 26.38p 51.59p -------------- -----------------------
Profit for the current and prior period is generated entirely from continuing operations.
Condensed group statement of comprehensive income
for the six months ended 30 September 2017
Six months Six months ended ended 30 September 30 September 2017 2016 GBP000 GBP000 Profit for the period 13,011 25,439 -------------- ------------------------ Items that will not be reclassified subsequently to profit or loss: Re-measurement of defined benefit liability (3,159) (10,664) Deferred tax on defined benefit pension schemes 537 1,920 Impact of deferred tax rate change in respect of pension schemes - (389) (2,622) (9,133) -------------- ------------------------ Total comprehensive income for the period attributable to Owners of the Company 10,389 16,306 -------------- ------------------------
Condensed group statement of financial position
as at 30 September 2017
30 September 31 March 30 September 2017 2017 2016 Notes GBP000 GBP000 GBP000 Non-current assets Intangible assets 10 10,830 11,058 10,777 Property, plant and equipment 11 1,480,018 1,455,380 1,430,220 Amount due from parent undertaking 190,013 190,013 190,013 Defined benefit pension surplus 8,104 9,616 7,372 1,688,965 1,666,067 1,638,382 -------------- -------------- -------------- Current assets Inventories 219 214 239 Trade and other receivables 12 77,336 72,113 72,627 Cash and cash equivalents 13 27,697 11,371 16,376 105,252 83,698 89,242 -------------- -------------- -------------- Total assets 1,794,217 1,749,765 1,727,624 -------------- -------------- -------------- Current liabilities Loans and borrowings 14 (15,000) - - Trade and other payables 16 (110,544) (96,130) (89,380) Deferred income (7,169) (6,573) (6,608) Provisions (2,361) (2,472) (3,860) (135,074) (105,175) (99,848) Non-current liabilities Loans and borrowings 14/15 (888,586) (882,024) (872,610) Derivative financial instruments 14/15 (104,501) (100,916) (91,052) Trade and other payables 14 (5,347) (4,261) (3,501) Net deferred tax liabilities (133,080) (132,895) (131,326) Defined benefit pension liability (1,378) (1,851) (8,577) Deferred income (72,157) (69,938) (67,234) (1,205,049) (1,191,885) (1,174,300) -------------- -------------- -------------- Total liabilities (1,340,123) (1,297,060) (1,274,148) -------------- -------------- -------------- Net assets 454,094 452,705 453,476 -------------- -------------- -------------- Equity Ordinary share capital 49,312 49,312 49,312 Revaluation reserve 258,965 261,549 264,063 Retained earnings 145,817 141,844 140,101 -------------- -------------- -------------- Total equity 454,094 452,705 453,476 -------------- -------------- --------------
The notes below are an integral part of these condensed group financial statements.
Condensed group statement of changes in equity
for the six months ended 30 September 2017
Issued share Revaluation Retained Total capital reserve earnings equity GBP000 GBP000 GBP000 GBP000 At 1 April 2017 49,312 261,549 141,844 452,705 --------- -------------- ----------- --------- Profit for the period - - 13,011 13,011 Other comprehensive loss - - (2,622) (2,622) Total comprehensive income - - 10,389 10,389 Dividends (see note 9) - - (9,000) (9,000) Amortise revaluation reserve - (3,064) 3,064 - Release revaluation on disposals - (43) 43 - Deferred tax on reserve releases - 523 (523) - At 30 September 2017 49,312 258,965 145,817 454,094 --------- -------------- ----------- ---------
for the six months ended 30 September 2016
Issued share Revaluation Retained Total capital reserve earnings equity GBP000 GBP000 GBP000 GBP000 At 1 April 2016 49,312 264,134 129,328 442,774 --------- -------------- ---------- -------- Profit for the period - - 25,439 25,439 Other comprehensive loss - - (9,133) (9,133) --------- -------------- ---------- -------- Total comprehensive income - - 16,306 16,306 Dividends (see note 9) - - (8,000) (8,000) Amortise revaluation reserve - (3,064) 3,064 - Release revaluation on disposals - (20) 20 - Deferred tax on reserve releases - 617 (617) - Impact of deferred tax rate change - 2,396 - 2,396 --------- -------------- ---------- -------- At 30 September 2016 49,312 264,063 140,101 453,476 --------- -------------- ---------- --------
Condensed group statement of cash flows
for the six months ended 30 September 2017
Six months Six months ended ended 30 September 30 September 2016 2016 Notes GBP000 GBP000 Operating activities Net cash flow from operating activities 64,450 62,882 Interest received 2,225 2,543 Interest paid (6,337) (17,354) Group tax relief paid (2,000) (1,000) Net cash flow before investing and financing activities 58,338 47,071 -------------- --------------- Investing activities Proceeds from sale of property, plant and equipment 103 159 Purchase of property, plant and equipment (47,807) (39,436) Purchase of intangible assets (1,414) (1,297) Fixed asset contributions received 1,106 932 Net cash flow used in investing activities (48,012) (39,642) -------------- --------------- Financing activities New bank loans received 15,000 - Dividends paid to shareholder 9 (9,000) (8,000) Net cash flow used in financing activities 6,000 (8,000) -------------- --------------- Increase/(decrease) in cash and cash equivalents 16,326 (571) Cash and cash equivalents at 1 April 11,371 16,947 -------------- --------------- Cash and cash equivalents at 30 September 13 27,697 16,376 -------------- ---------------
Notes to the condensed group financial statements
for the six months ended 30 September 2017
1. Basis of preparation
The condensed group financial statements for the six months ended 30 September 2017 are set out above, and have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and IAS 34 Interim Financial Reporting as endorsed by the European Union. The statements should be read in conjunction with the financial statements for the year ended 31 March 2017, which have been prepared in accordance with International Financial Reporting Standards ("IFRS") endorsed by the European Union.
The condensed group financial statements are presented in sterling.
These interim financial results are neither audited nor reviewed by our auditor. The information for the year ended 31 March 2017 does not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 March 2017 were approved by the Board of Directors on 14 July 2017 and delivered to the Registrar of Companies. The report of the auditors on those accounts was not qualified, did not include any reference to any matters to which the auditors drew attention by way of emphasis without qualifying the report and did not contain any statement under section 498(2) or (3) of the Companies Act 2006.
2. Accounting policies
Changes in accounting policies
The accounting policies adopted are consistent with those of the financial statements for the year ended 31 March 2017 as described in those financial statements.
3. Total income Six months Six months ended ended 30 September 30 September 2017 2016 GBP000 GBP000 Revenue Unmetered water income 19,083 24,537 Metered water income 92,573 83,417 Other sales 2,794 3,036 -------------- -------------- Total revenue 114,450 110,990 -------------- -------------- Other income Rental income 566 585 Sundry income 3,274 3,354 -------------- -------------- Total other income 3,840 3,939 -------------- -------------- Total income 118,290 114,929 -------------- --------------
All revenue is from customers within the United Kingdom.
4. Segmental analysis
The group's revenue mainly arises from the supply of water and related activities. The activities of the group, for management purposes, fall into three operating areas being the supply of potable water on a wholesale basis, the supply of potable water and waste water services on a retail basis, both of which are governed by the Water Act 2014, and related non-regulated activities.
The group analyses results by segment to operating profits only, therefore no segmental statement of financial position or statement of cash flows are presented.
Period to 30 September Wholesale Retail Other 2017 activities activities activities Total GBP000 GBP000 GBP000 GBP000 Total income 101,921 12,329 4,040 118,290 ------------ ------------ ------------ --------- Operating profit 36,019 1,725 1,537 39,281 ------------ ------------ ------------ Finance income 2,349 Finance costs (26,957) --------- Profit before taxation 14,673 Taxation (1,662) --------- Profit for the period 13,011 --------- Period to 30 September 2016 Total income 98,932 12,074 3,923 114,929 ------------ ------------ ------------ --------- Operating profit 38,610 1,560 1,869 42,039 ------------ ------------ ------------ Finance income 2,686 Finance costs (22,882) --------- Profit before taxation 21,843 Taxation 3,596 --------- Profit for the period 25,439 --------- 5. Net operating costs Six months Six months ended ended 30 September 30 September 2017 2016 GBP000 GBP000 Employee benefits expenses 14,662 13,550 Asset expenses 24,348 22,616 Other operating expenses 39,999 36,724 -------------- -------------- 79,009 72,890 -------------- -------------- 6. Finance costs Six months Six months ended ended 30 September 30 September 2017 2016 GBP000 GBP000 Effective interest on listed debt 11,129 10,950 Fair value movements on interest rate swap 3,585 3,825 Indexation on listed debt 3,143 1,729 Interest on index linked loans 5,810 5,657 Indexation on index linked loans 3,146 727 Other finance costs 1,189 1,208 28,002 24,096 Less: interest capitalised (1,045) (1,214) -------------- -------------- 26,957 22,882 -------------- -------------- 7. Finance income Six months Six months
ended ended 30 September 30 September 2017 2016 GBP000 GBP000 Interest receivable from group undertakings 2,210 2,462 Pension fund finance credit 124 168 Interest receivable on bank balances and short term deposits 15 56 2,349 2,686 -------------- -------------- 8. Taxation Six months Six months ended ended 30 September 30 September 2017 2016 GBP000 GBP000 Current taxation charge 940 1,717 Deferred taxation charge/(credit) 722 (5,313) 1,662 (3,596) ------------------------- --------------
The current tax charge is recognised based on management's estimate of the weighted average annual corporation tax rate expected for the full financial year.
9. Dividends Six months Six months ended ended 30 September 30 September 2017 2016 GBP000 GBP000 Equity dividends paid during the period of 18.3p per share (2016: 16.2p) 9,000 8,000 -------------- --------------
10. Intangible assets
GBP000 Net book amount At 1 April 2017 11,058 Additions for the period 1,953 Reclassification of assets in the period (539) Amortisation for the period (1,642) -------- At 30 September 2017 10,830 -------- Net book amount At 1 April 2016 11,046 Additions for the year 3,197 Amortisation for the year (3,180) Disposals for the year (2) Impairment for the year (3) -------- At 31 March 2017 11,058 -------- Net book amount At 1 April 2016 11,046 Additions for the period 1,297 Amortisation for the period (1,566) -------- At 30 September 2016 10,777 --------
11. Property, plant and equipment
GBP000 Net book amount At 1 April 2017 1,455,380 Additions for the period 46,908 Reclassification of assets in the period 539 Disposals for the period (88) Depreciation for the period (22,721) At 30 September 2017 1,480,018 ---------- Net book amount At 1 April 2016 1,412,184 Additions for the year 86,625 Disposals for the year (116) Depreciation for the year (43,275) Impairment for the year (38) ---------- At 31 March 2017 1,455,380 ---------- Net book amount At 1 April 2016 1,412,184 Additions for the period 39,245 Disposals for the period (63) Depreciation for the period (21,120) Impairment for the period (26) ---------- At 30 September 2016 1,430,220 ----------
12. Trade and other receivables
30 September 31 March 30 September 2017 2017 2016 GBP000 GBP000 GBP000 Financial asset receivables Trade receivables 33,580 32,669 31,033 Accrued income 36,879 32,433 35,288 Amounts due from group undertakings 273 96 37 70,732 65,198 66,358 ------------- --------- ------------- Non-financial asset receivables Prepayments 4,727 3,302 4,438 Other receivables 1,877 3,613 1,831 ------------- --------- ------------- 6,604 6,915 6,269 ------------- --------- ------------- 77,336 72,113 72,627 ------------- --------- -------------
13. Cash and cash equivalents
30 September 31 March 30 September 2017 2017 2016 GBP000 GBP000 GBP000 Cash at bank and in hand 27,697 11,371 9,376 Short term bank deposits - - 7,000 ------------- --------- ------------- 27,697 11,371 16,376 ------------- --------- -------------
14. Financial liabilities
30 September 31 March 30 September 2017 2017 2016 GBP000 GBP000 GBP000 Non-current liabilities Irredeemable debenture stock 991 991 991 Listed bonds 526,284 523,281 520,563 Index linked loans 361,311 357,752 351,056 ------------- --------- ------------- Loans and borrowings 888,586 882,024 872,610 Derivative financial instruments 104,501 100,916 91,052 Trade and other payables 5,347 4,261 3,501 ------------- --------- ------------- 998,434 987,201 967,163 ------------- --------- ------------- Current liabilities Other bank loans 15,000 - - ------------- --------- -------------
Trade and other payables which fall under the heading of financial liabilities are reported under note 16.
15. Financial Instruments
Fair values of financial assets and financial liabilities
Fair value is the amount at which a financial instrument could be exchanged in an arm's length transaction between informed and willing parties. In the opinion of the directors, the fair values of the financial assets and liabilities of the group (apart from the specific items shown in the fair value table below) are not materially different from the book values.
Book Fair Book Fair Book Fair Value Value Value Value Value Value 30 September 30 September 31 31 30 September 30 September 2017 2017 March March 2016 2016 GBP000 GBP000 2017 2017 GBP000 GBP000 GBP000 GBP000 Loans and receivables Amounts due from parent undertaking 190,013 173,920 190,013 140,373 190,013 193,321 -------------- -------------- ---------- ------------ -------------- -------------- Financial liabilities at amortised cost Irredeemable debentures 991 841 991 766 991 921 Listed bonds 526,284 631,450 523,281 659,312 520,563 633,743 Index linked loans 361,311 660,655 357,752 441,423 351,056 489,057 -------------- -------------- ---------- 888,586 1,292,946 882,024 1,101,501 872,610 1,123,721
-------------- -------------- ---------- ------------ -------------- --------------
The following table details the financial instruments that are carried in the group's books at the fair value at 30 September 2017.
Book and Book and Book and Fair Value Fair Value Fair Value 30 September 31 March 30 September 2017 2017 2016 GBP000 GBP000 GBP000 At fair value through the income statement Derivative financial instruments - Interest rate swap 104,501 100,916 91,052 -------------- ------------ --------------
The book value of the interest rate swap has been adjusted to reflect its fair value.
Fair value hierarchy
The group held the following financial instruments measured at fair value:
Total Level Level Level GBP000 1 2 3 GBP000 GBP000 GBP000 Financial liabilities at fair value through the income statement 30 September 2017 Interest rate swap (104,501) - (104,501) - ------------ -------- ------------ -------- 31 March 2017 Interest rate swap (100,916) - (100,916) - ------------ -------- ------------ -------- 30 September 2016 Interest rate swap (91,052) - (91,052) - ------------ -------- ------------ --------
During the reporting period ended 30 September 2017, there were no transfers between Level 1 and Level 2 fair value measurements and no transfers into and out of Level 3 fair value measurements.
The group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:
-- Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities;
-- Level 2: other techniques for which all inputs with a significant effect on the recorded fair value are observable, either directly or indirectly; and
-- Level 3: techniques using inputs which have a significant effect on the recorded fair value that are not based on observable market data.
16. Trade and other payables
30 September 31 March 30 September 2017 2017 2016 GBP000 GBP000 GBP000 Financial liability payables Trade payables 10,674 14,339 11,724 Amounts due to group undertakings 10,191 11,266 10,839 Other payables 5,119 949 675 Accruals 46,088 33,354 29,682 ------------- --------- ------------- 72,072 59,908 52,920 ------------- --------- ------------- Non-financial liability payables Payments received in advance 37,516 35,207 35,480 Other taxes and social security 956 1,015 980 ------------- --------- ------------- 38,472 36,222 36,460 ------------- --------- ------------- 110,544 96,130 89,380 ------------- --------- -------------
17. Subsequent events
There have been no post balance sheet events that require disclosure.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BSBDDDBBBGRX
(END) Dow Jones Newswires
December 14, 2017 02:00 ET (07:00 GMT)
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