Warrington-based United Utilities, the UK’s largest listed water company, said in a trading statement its revenue is expected to be “slightly higher than last year” and underlying operating profit for 2017-18 is expected to be “moderately higher than 2016-17.”

In the year to March 31, 2017, the firm’s underlying operating profit rose £19 million to £623 million on revenue down £26 million to £1.704 billion.

“Group revenue is expected to be slightly higher than last year, reflecting our allowed regulatory revenue changes, partly offset by the accounting impact of our Water Plus business retail joint venture, which completed on 1 June 2016,” said the firm.

“Underlying operating profit for 2017-18 is expected to be moderately higher than 2016/17.

“Infrastructure renewals expenditure (IRE) has increased slightly in the second half of the year, although full year IRE for 2017-18 is expected to be similar to last year.

“RPI inflation has increased this year which is expected to increase the company’s regulatory capital value (RCV) by around £400 million.

“Since United Utilities is well hedged for inflation, there is also an impact of higher RPI inflation on our index-linked debt and we expect the underlying net finance expense for 2017-18 to be around £40 million higher than last year.

“As the company continues to invest in its asset base, we expect a small increase in group net debt at 31 March 2018 compared with the position as at 30 September 2017.

“Our responsible approach to financial risk management continues to deliver benefits including a strong balance sheet, a stable IFRS pension surplus and gearing comfortably within our target range of 55% to 65% net debt to RCV, supporting a solid A3 credit rating for United Utilities Water with Moody’s.”

United Utilities will announce full year results on May 24, 2018.