United Utilities PLC (LSE:UU.) announced plans on Thursday to raise £800 million in equity, equivalent to around 9% of its market value, as part of efforts to fund a significant expansion of its AMP8 investment programme.
The United Utilities now intends to increase total planned investment to £11.5 billion, up from the previously outlined £9 billion. This represents an additional £2.5 billion in capital expenditure over the 2025 to 2030 regulatory period.
Higher spending set to boost asset base growth
The expanded investment plan is expected to accelerate growth in the company’s regulatory asset base, with projections rising to a compound annual growth rate of approximately 10% through 2030, compared with earlier expectations of 7%.
Alongside this, management has upgraded its financial framework targets, now aiming for regulatory returns of 10% to 11%, roughly 100 basis points higher than prior guidance.
Funding structure and balance sheet targets maintained
The planned equity raise will cover the equity component of the increased capital expenditure, while United Utilities expects to keep its gearing within its target range of 55% to 65% throughout the AMP8 period.
The share issuance will consist of new ordinary shares with a nominal value of 5 pence each and includes a £400 million cornerstone investment commitment, providing initial support for the fundraising.
More about United Utilities
United Utilities PLC is a UK-based water and wastewater services provider, supplying millions of customers across North West England. The company operates within a regulated framework and invests heavily in infrastructure to maintain and improve water quality, environmental performance, and service reliability.
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