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Last Updated: Thursday, 10 August 2006, 09:47 GMT 10:47 UK
Profits up at Thames Water owner
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Thames supplies eight million users in London and the South East
RWE, the German owner of UK water firm Thames Water, has reported a 19% rise in first-half operating profits.

Utility giant RWE said that surging power prices had helped it to raise profits to 4.1bn euros ($5.3bn; 2.8bn) during the period.

RWE said talks were continuing about a potential sale of Thames Water, thought to be worth about 7bn, although it gave no details about possible buyers.

In June, Thames Water announced a 31% rise in pre-tax profits to 346.5m.

The UK firm was also found to have missed its target for reducing leakages for the third year in a row.

We are conducting various talks and I can not reveal the names of any potential buyers (of Thames Water)
Harry Roels, RWE chief executive

Although it escaped fines from watchdog Ofwat, instead of having to pay a penalty the company was told to invest an extra 150m over five years to replace ageing pipes.

Thames was expected last year to cut the average amount of water leaking from its pipes each day to 860 million litres, but only managed to reduce it to 894 million.

Scrutiny

RWE, which also has interests in gas, electricity and recycling, bought Thames Water for 4.8bn in 2000 but analysts reckon it could now fetch a far higher price.

Thames Water supplies water to eight million people across London and the south of England, and also provides sewage services to 13 million customers.

Any sale of Thames Water is likely to be closely scrutinised by the competition authorities.

RWE said it was on track to sell its UK and North American water operations over the next year although it was also considering a possible flotation of the businesses.

"We are conducting various talks and I can not reveal the names of any potential buyers," said RWE chief executive Harry Roels.




SEE ALSO
Thames Water escapes leakage fine
04 Jul 06 |  Business
Thames Water misses leak target
22 Jun 06 |  Business
Water company denies sewage claim
27 Oct 05 |  Southern Counties
Water firms missing leak targets
14 Jul 05 |  Business

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