Thames Water - comment

The good start to the week with another negative headline from Thames Water. The company issued a delayed update to its five-year business plan to Ofwat today where it revealed that its totex for 2030 will be 7% higher than initially announced in October 2023 to £19.8 billion. The reason for the increase was additional capital was needed to fund projects “benefitting the environment”.  In addition, it also expects average annual bills rising to £608 sticking to its previous proposals that bills need to rise by 40% by 2030. The deadline for a response from Ofwat is the 12th June 2024. As the new money need is now higher - this clearly will push recoveries for existing creditors down in a restructuring or special administration scenario….