Thames Water has warned it risks running out of cash in less than a year as it unveiled urgent plans to find new funding.
Britain’s biggest water supplier said on Tuesday it was seeking a fresh equity injection as it posted a jump in its debt pile.
It came as Thames Water increased dividend payments to £196m, up from £45m a year ago, to cover the cost of debt interest payments. Shareholders did not receive the dividends, the group said.
Thames revealed it had liquidity for the next 11 months until May 2025 totalling £2.5bn, but faced a cliff edge of uncertainty unless fresh cash could be found.
Thames is struggling under a debt mountain and needs urgent investment to keep going to avoid the risk of nationalisation.
Net debt at the company rose to £15.3bn for the year ending March 2024, up from £13.9bn a year ago.
The group’s shareholders have previously rebuffed plans to inject fresh capital into the business and have written off their investments.
Ofwat, the water regulator, is due to issue a draft judgment on Thames’ five-year business plan on July 11.
The group said it would be engaging with potential investors and creditors to seek fresh equity to improve its funding position.
Chris Weston, the chief executive, said: “We have set out an ambitious business plan for the next five years, and I believe that with consistent leadership and priorities, time and resources, and the appropriate regulatory determination we will turn around this business and make it perform for all our customers, the environment and our wider stakeholders.”
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