LONDON -- The shares of United Utilities have advanced 1.3% as of 10:20 a.m. EDT after the company confirmed that current-year profits would be "slightly higher" than the year before.
United Utilities, which supplies water to about 7 million people in North West England, also claimed today that it continues to be "on track to deliver its 2010-2015 regulatory outperformance targets." Within today's statement, the FTSE 100 member admitted that sales had increased at a rate "slightly below" the allowed regulated price rise for fiscal year 2013. The shortfall was blamed on the "continuing impact of a tough economic climate on commercial volumes."
United Utilities added that its capital expenditure for the current year would be at least 750 million pounds and that its current net debt was slightly higher than the 5.3 billion pounds seen at the end of September.
Today's statement did not mention anything about the dividend, which United Utilities has previously indicated should grow annually by 2% plus the rate of inflation as measured by the Retail Price Index until at least 2015.
Within November's half-year results, the group lifted its interim payout by 7% to 11.44 pence per share, and the current-year payout is forecast to gain 7% as well to 34.3 pence per share. The near-term yield is therefore 4.8%, which is greater than the 3.5% currently on offer from the FTSE 100 but less than the 5.7% provided by an alternative blue-chip utility share.
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The article United Utilities Should Still Offer 4.8% Yield originally appeared on Fool.com.
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