United Utilities pays out £340m dividend after Windermere sewage scandal

The water company accused of pumping millions of liters of sewage into Lake Windermere has paid out almost £340 million to shareholders as it celebrates a record year.

United Utilities took in just under £2 billion in revenue in the 12 months to March 31, an increase of 8.1 percent on the previous year. It also paid dividends worth £339 million.

And as the pollution row once again engulfs the industry, the company’s CEO, Louise Beardmore, stressed that the company takes its “role in protecting the environment very seriously.”

The comments and stunning results came just a day after United Utilities was accused of failing to stop illegal pollution of one of Britain’s most famous lakes.

A technical fault in February led to untreated sewage flowing into Windermere, part of the Lake District’s UNESCO World Heritage site.

But according to the BBC, the Environment Agency was not notified of the pollution until thirteen hours after the leak began.

It follows a series of scandals, including a similar incident at the lake two years ago, which turned miles of water bright green.

The sector is currently in crisis, as United Utilities and its peers are struggling with mounting debt.

Despite record revenues – worth more than £5 million a day – profits at United Utilities fell by more than a third to £170 million last year as it spent more on repaying its debts.

But the company still paid a dividend of 49.78p per share, which was more than 9 percent more than the previous year, giving investors a total of £339 million.

Related articles


Campaigners yesterday said it was ‘insane’ to pay higher dividends when it was causing such massive environmental damage.

Matt Staniek, founder of the group Save Windermere, called for more efforts to hold the company to account.

He said: ‘The impact [of sewage] on Windermere is just awful. It simply isn’t due to climate, rainfall or combined systems; it is a lack of investment to adequately address these issues.”

And he said leaks would continue to occur because the regulator appeared to be ‘deeply asleep’.

Leakage: A technical fault in February led to untreated sewage flowing into Windermere, part of the UNESCO World Heritage Site in the Lake District

Anger among local residents and businesses increased, Staniek added.

“The reason Windermere is so prominent in the national story is because millions of people visit it every year,” he said. “It is the people’s lake and one of the country’s greatest natural resources.”

In a statement, Beardmore said: ‘Colleagues have worked exceptionally hard all year to deliver results for our customers, communities and the environment.’

Referring to the Lake District as ‘a special place’, she said United Utilities was ‘rapidly accelerating’ a £400 million investment in reducing leaks in locations such as Windermere.

She also said the company has met or exceeded about 80 percent of its regulatory targets.

The CEO took the top job last year with a basic salary of £690,000.

She must reduce leaks by at least 8 percent to receive a bonus of up to £900,000.

Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said: ‘The UK water sector remains in the spotlight, and there is still much work to do to restore public confidence.’

Water industry regulator Ofwat said: ‘The environmental performance of water and wastewater companies is simply not good enough and they need to go further and faster.’

Investor quits Thames Water Board

Thames Water’s largest shareholder has withdrawn its director from the board, in a sign that investors are about to abandon their interests.

The resignation of Michael McNicholas, from Canadian pension fund Omers, comes amid reports that other shareholders are planning to withdraw directors.

Thames linked it to a row with the industry regulator over plans to increase bills by 45 percent as the company fights to stay afloat and avoid a taxpayer-funded bailout.

Britain’s largest water company was plunged into crisis this year when shareholders refused to hand over £3bn of funding.

The company has until the end of next year to find more money or risk being thrown into administration, amid outrage over the sector’s poor customer service and sewage discharges into waterways.

Thames wants to increase bills from £433 this year to £627 by 2030 to fund between £19.8 billion and £21.7 billion of improvements for its 16 million customers in London and the South East.

In June, regulator Ofwat will make its preliminary judgment on Thames’ five-year plan, after blocking an earlier interest rate increase.

Ofwat’s draft ruling will be negotiated, and the final version will be published in December.

The regulator blocked Thames’ earlier proposal to increase bills by 40 percent and spend £18.7 billion between 2025 and 2030.

Thames Water said the watchdog’s decision had made the first scheme ‘uninvestable’ as shareholders backtracked on promises to provide funding.

Some links in this article may be affiliate links. If you click on it, we may earn a small commission. That helps us fund This Is Money and keep it free to use. We do not write articles to promote products. We do not allow a commercial relationship to compromise our editorial independence.

Leave a Reply

Your email address will not be published. Required fields are marked *