Thames Water has fallen to a £1.65bn annual loss over a year in which it saw its debt mountain balloon to £16.79bn.
The struggling utility firm, which covers a large area of London and the Thames Valley as well as Oxfordshire, Berkshire, Wiltshire and Gloucestershire, tumbled to the pre-tax loss in the year to March 31 from profits of £157m the previous year.
The slump came after the company booked a £1.27bn bad debt provision on intercompany loans and set aside £122m for fines from Ofwat, among other costs.
“Thames Water has made good progress in operational performance, despite the ongoing challenging financial situation,” said Chris Weston, chief executive.
“The new organisation structure, focused on our infrastructure, brings clearer accountability and has helped our transformation continue to gain momentum.
“As a result, we have made sustained progress overall against our six critical operational priorities in 2024/25. However, that progress is not demonstrated in our disappointing pollutions outturn.”
The group’s full-year results showed its mammoth net debts swelled by another £1.65bn over the year, while it revealed a “disappointing” performance on pollution and sewage spills.
The figures come as the water firm remains in talks over a rescue funding deal with senior creditors after private equity firm KKR last month pulled out of plans to inject much-needed cash.
Mr Weston added: “We recognise that our current gearing is too high and, to address this, we are progressing with our Senior Creditors’ plan to recapitalise the business which will see us return to a more stable financial foundation.
“This will come with a requirement to reset the regulatory landscape and acknowledge it will take at least a decade to turn Thames around.”
The announcement by the Thames Water comes a day after the utilities firm said a hosepipe ban would begin next Tuesday for customers in Oxfordshire, Gloucestershire, most of Wiltshire and some parts of Berkshire.
The measure is being brought in after the Environment Agency placed its area into the “prolonged dry weather category”.
The ban will begin on July 22 for customer in all OX postcodes, all GL postcodes, all SN postcodes as well as customers in RG4, RG8 and RG9 postcodes.
