DEE VALLEY GROUP PLC
The Board of Dee Valley has carefully considered the detailed information provided by Ofwat on 12 December 2014 as part of its Final Determination of price limits, to apply from 2016 to
2020. The Board today announces that, after careful consideration, its subsidiary, Dee Valley
Water Plc, has decided to accept the Final Determination.
The Final Determination outcome for the Group and indeed the whole sector presents a significant challenge with Ofwat allowing a considerably lower return on capital of 3.6% (2010/11-2014/15: 5.1%). As a consequence, Ofwat's proposals would mean that the average household bill for water between 2015/16 and 2019/20 would decrease by on average 2% to around £142 compared to a 2014/15 average of £144 (excluding the effects of inflation).
During this period Dee Valley Water plc, the Group's operating subsidiary, will be investing up to £50 million in its business, which represents the largest ever capital programme in the Group's history. This necessary investment will focus on the replacement of key assets and maintenance of the Company's asset infrastructure.
The Final Determination can be found at www.ofwat.gov.uk/pricereview/pr14/finaldet.
The Board will announce its future dividend policy in due course following finalisation of its financing arrangements in relation to the above-mentioned capital programme.
Dee Valley Group plc Ian Plenderleith - Chief Executive
Tel: 01978 846 946 Andrew Bickerton - Finance Director
Investec Bank plc Jeremy Ellis
Tel: 020 7597 4000 Josh Levy
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