Can you show me which UK water companies are in such a situation?

My provider is Thames Water. They are losing money.

Sure thing!

According to https://www.bbc.co.uk/news/articles/cgleg70r7rno

> When Thames was privatised in 1989, it had no debt. But over the years it borrowed heavily and its total debt - which includes all of its borrowings and liabilities - now stands at £22.8bn, according to latest financial results, external.

> Its debt pile increased sharply when Macquarie, an Australian infrastructure bank, owned Thames Water, with debts reaching more than £10bn by the time the company was sold in 2017.

According to https://www.bbc.co.uk/news/business-41152516

> Macquarie and its investors paid £5.1bn for Thames Water, of which £2.8bn was money Macquarie had borrowed [...] £2bn had subsequently been repaid. Not by Macquarie and its investors, who had originally borrowed the money, but from new borrowings raised by Thames Water through a Cayman Islands subsidiary.

> Martin Blaiklock said: "That letter was a red flag to me because it showed clearly that the debt which Macquarie funds had used to buy Thames Water had been transferred over to Thames Water." [...]

> the total returns made by the bank and its investors from Thames Water averaged between 15.5% and 19% a year. Mr Blaiklock has 40 years of experience in such matters and said these returns were "twice what one would normally expect"

According to https://news.sky.com/story/approval-for-higher-bills-and-loa...

> The company, which has been crumbling under a £16bn debt pile, was due to run out of money in about a month's time. It has now received court approval for another £3bn loan [...] the company's gearing ratio is 80% and its annual debt interest bill is around £900m (about a third of the revenue it gets from customer bills) [...]

> The water regulator has sanctioned bill increases of 35% by 2030.

> However, Thames wants more. It is seeking a 53% increase, which would take the average bill to £677 a year

This stuff's all pretty widely documented and reported, if your idea of fun is getting angry and depressed while also reading about business accounting.

	▲	marcus_holmes 3 days ago \| parent [-]
		The flip side of this is that Thames Water is clearly not an ongoing concern and can therefore be re-nationalised at zero cost [0]. I believe there's language in the original privatisation deal around this. Ofc, that doesn't claw back the billions that the PE pirates made off with, but at least the UK wouldn't have to pay them even more to get its water supply under control again. [0] even if the UK had to pay market value for it, the market value for a business so drowning in debt would be close to zero.

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swiftcoder 4 days ago | parent | prev | next [-]

> My provider is Thames Water. They are losing money.

Are they losing money because costs exceed revenue, or are they losing money because they are servicing massive loan interest on money they already distributed to shareholders?

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jermaustin1 4 days ago | parent [-]

Page 10 of their 24/25 annual report says they only pay 8% toward interest payments, the largest outgoing is infrastructure, then opex.

https://www.thameswater.co.uk/media-library/l13deqmw/thames-...

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swiftcoder 4 days ago | parent | next [-]

I'm not a financial wiz, but it seems like they are playing games here, as a huge chunk of their stated losses for the year is some sort of loan write-off against their parent company.

> £1,271 million of expected credit loss provision recognised against the intercompany loan receivable from TWUL’s immediate parent company, Thames Water Utilities Holdings Limited. This balance is fully provided for, as it is not deemed recoverable

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nerdponx 3 days ago | parent [-]

It blows my mind that this is legal in any developed nation. The whole PE playbook seems like embezzlement carried out in broad daylight.

	▲	wpm 3 days ago \| parent [-]
		That's because it is!

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Retric 4 days ago | parent | prev | next [-]

That doesn’t answer the question.

However, any money paid to shareholders while accumulating debt, including deferred maintenance, etc was financial smoke and mirrors not actual profit.

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blibble 3 days ago | parent | next [-]

yes, paying dividends out of debt is completely illegal

but apparently not if you wrap it in half a dozen companies in various tax havens

(that have no legitimate purpose other than various types of laundering)

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VirusNewbie 4 days ago | parent | prev [-]

Does the government not do this?

	▲	thfuran 3 days ago \| parent [-]
		Unless you're trying to ask "is the level of corruption in government nonzero", the answer is unequivocally no because the government doesn't have shareholders.

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patanegra 4 days ago | parent | prev | next [-]

In the last 10 years, they did £18107.3m turnover, and cumulative -1180.3m loss.

Poor shareholders, mainly Ontario Municipal retirement fund pensioners, who are the biggest ones (32%) and retired British academics (20%).

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mytailorisrich 3 days ago | parent | prev [-]

And yet they have paid dividends until last year and the regulator has now banned them from doing so without approval and fined them, too.

They are a scam operation, frankly.

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Iwan-Zotow 4 days ago | parent | prev [-]

What is the debt load of TW? Cost of servicing it?