Poor weather hinders pipe repairs by water firm

The parent group behind water and waste water company Essex & Suffolk Water says efforts to reduce leaks last year were hampered by bad winter weather.

Northumbrian Water, which confirmed earlier this month that it will allow Hong Kong entrepreneur Li Ka-shing to examine the company's books ahead of a possible takeover bid, said water and sewerage charges had increased by 8.5% for 2011/12.

Two major projects - the expansion of Abberton reservoir and construction of an advanced anaerobic digestion plant at Howdon - are 'progressing well and remain on schedule', but it was disappointed to have missed a leakage target in the North for 2010/11 'as a result of the most severe December weather for over a hundred years'.

However, it said it had implemented an action plan for the leaks and to date it was ahead of its targets for the year.

Its performance in the first four months of the year to July has been in line with expectation, it says.

The Hong Kong bid would give Northumbrian a price tag of �2.4bn, but the group said yesterday there could be 'no certainty' that any offer will be made for the company, nor any certainty about the terms on which any offer might be made. Operating costs for the 12 months to 31 March 2012 are forecast to increase by around 3%, as inflationary pressures and new carbon reduction commitments take effect, it said.