New blow from Yorkshire Water
Thursday 30 November 1995
Deputy City Editor
Yorkshire Water dealt a further blow to its long-suffering customers yesterday when it emerged that the company was considering compulsory metering to cut demand in the drought-stricken region.
The prospect is certain to increase anger towards the company, which continued to improve profits throughout the summer when water supplies were constantly at risk.
The news came as Yorkshire announced a 10 per cent rise in underlying profits for the six months to September. Including a pounds 25m restructuring charge, which held back 1994's first half, profits jumped 48 per cent in the period, from pounds 67.2m to pounds 99.5m.
Shareholders were rewarded with a 10 per cent dividend rise to 9.1p but were told that they would have to fund a pounds 75m investment programme to increase water resources and stem leaking pipes. Yorkshire currently loses 26 per cent of its supplies before they even reach the taps.
Sir Gordon Jones, chairman, said the widely publicised supply problems this year had been caused by unprecedented weather conditions, with rainfall in west Yorkshire less than half the long-term average. Half the company's customers live in the western part of the county, a problem compounded by the 20 per cent rise is domestic demand, mainly thanks to garden watering.
Reservoirs, which have normally regained 60 per cent of capacity by this time of the year, are only 20 per cent full, as low as they have been all year. Bringing water in by road to the worst-hit areas is costing pounds 3m a week.
Analysts said the cost of supplementing supplies would hit full-year profits and took red pens to their forecasts. Only pounds 4.6m of the pounds 20m accumulated cost to the company so far had been taken in the interim figures.
Investment column, page 22
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