Pennon Group Plc

Now, I'd like to hand over to Susan Davey, CEO of Pennon Group, to begin. Please go ahead. Good morning, everyone. I'm Susan Davey, CEO of Pennon Group, and I'm joined by Laura Flowers, who is our CFO. We're here today in our incident room in Devon. Laura and I are pleased to take you through the results and highlights of Pennon's 2024-25 half year, and we look forward to answering any questions at the Q&A session at 8.45 this morning. It's been a very busy half year operationally and as we right-side through our new business found K8. I can't reflect on this half year without talking about the incident in Brixham. For eight weeks in the summer, we worked tirelessly to return safe cane drinking water to the people and businesses in and around Brixham and Devon. Over 800 brilliant colleagues and supply chain partners supported customers as we flushed 30 kilometres of the network 27 times, and installed UV infiltration equipment to ensure the supply could be restored as quickly and as safely as possible. I'd really like to thank customers for their incredible patience, but also their kindness to colleagues who were working on the ground at all hours. Alongside the Brixham event, colleagues have been focused on tackling pollutions and the issue of storm overflows. With rainfall over 15% higher than the high base of 2023 and continuing severe weather fronts, weather is never an excuse, but it is a context. Beneath the headline numbers, we are making progress. I want to start by saying the fundamentals to the business are robust. We were pleased to receive clearance from the CMA in June for our acquisition of Sutton and East Surrey. Integration is underway alongside our group-wide right-sizing and reshaping as we head into the new regulatory delivery period. We're reshaping the group with four clear business lines aligned to our four strategic priorities. Through right-sizing, we are focused on having more of our colleagues on the front line. And with these changes, we'll have increased frontline teams by 35% over this five-year regulatory period, K7. A really good position to be in as we head into K8. We have set out our plans to invest to improve outcomes in K7, whether it improves the water resource positioning following the drought, or getting ahead with storm overflow investment with WaterSick programme. We have invested $200 million in the asset base this half-year, broadly consistent with the run rate from the end of 2023-24, and aligned with the soon-to-be KXR rate for investment. The solid operational performance across all parts of the group, whether you are a Southwest Water, Bristol Water, or a certainly Surrey customer, was recognised enough what Water Company Performance Report issued last month in October. Having received outstanding and good assessments for Southwest Water and certainly Surrey's respective business plans, We are well positioned to deliver our plans for K8 and another period of significant growth. As we're closing the K7 regulatory period, I've been reflecting on it being a significant period of change for the tenant group. Our agility in delivering for all stakeholders has been constant. Following the same material in 2020 and as part of a highly disciplined strategic review, we responsibly deployed capital, positioning the group sustainably by minimising liabilities. We've invested in the UK water with the acquisition of Bristol and certainly Flurry at a total value of $0.6 billion. And we've recognised shareholder support through our K7 dividend policy. We've made a record investment in the asset base of $1.8 billion as we focus on things that matter most to customers, which alongside our acquisitive growth strategy results in RTV growth of 75%. We're also expanding our non-regulated business. with our three business-to-business retailers now having a combined market share of around 15%, and our investments in 10 on Power are on track. Customers have benefited to our innovative first-of-its-kind WaterShare Plus team. Launched in 2020, this gives customers a stake and a say in our business, and they also have shared in the financial benefits. Alongside this, we have delivered solid relative sector performance with around 70% of ODIs met over the period, We are focused on supporting those customers, keeping bills as low as possible through drive efficiency and providing tangible support to those who need it most, achieving 100% affordability for the first time this year. With managing directors in place for water services, wastewater services, power and retail services, we are reshaping the new group aligned to the new model and ensuring we have the right resources and capabilities on the front line and streamline corporate functions. Supporting this, our supply chain partnership, Amplify, has already been stood up and delivering on over 1,000 schemes, including $75 million in accelerated investment to kickstart our plans in Eastville from stormy flows. Our four strategic priorities are not new. They are a constant, and you have heard me consistently talk about them. The actions of Drumbeat internally for our 4,000 colleagues and supply chain partners ensure we can deliver on our commitments personally and in delivering the things that matter most to customers. Our customer and community roadshows this year have been a personal highlight. We have been able to reconfirm our priorities by discussing those with customers. We're listening. Whether from Bristol to Bournemouth and across Devon, Cornwall, the Aldersville, and more recently, certainly Surrey, in investing to protect water quality and enhance resilience, we have broken the drought cycle for Devon and Cornwall while ahead of plan. In tackling the stormwater flows, our beaches, and eradicating pollutions, we are making progress to the sustainable reductions and making sure that these are made. We're working to invest in renewable energy, be risky in the energy requirements of the water business, and building a portfolio that has returns in excess of the regulated water business for the capital allocated. At the same time, we continue to successfully support customers with affordability pinch points, a key aspect that has been to manage customer bills to be lower than they were 10 years ago. as we place to eradicate water poverty. The financial results for the 2024-25 half-year include the first full six months of certainly need slurry. While it helps the understanding of the results, we will refer to like-for-like comparisons. First, revenue. Our successful water demand customer initiative, helping customers to use less and save more, has meant that on a like-for-like basis across the whole water business, we've seen lower revenues. Regulatory revenue mechanisms are in place to protect heat recovery and Nora will walk through the financial position. Second, the cost base. We're on track to deliver 55 million of cumulative annualised efficiency savings in 2024-25 as we reshape the group and integrate SES towards our targeted annualised savings of 86 million in K8. This is an important base in which to deliver the K8 business plans. Third, Having ramped up the expenditure during K7, we are delivering at the required K at run rate, and the supply chain aligns amplify are in place. Fourth, our return on regulated equity to the water businesses is relatively strong, at 10.8% on a nominal actual balance sheet basis and 6% on a real notional water share basis. Fifth, We are delivering to investors as well as customers with robust relative performance on common ODIs, with overall cumulative ODI performance at 70%. And finally, we have retained and grown our cost of all sector leasing, business-to-business retailers, pen and water services, and water-to-business. They both continue to deliver excellent customer service and drive market share, doubling PPC against H1 2023-24. And we have plans to consolidate SES, business retailer into the group. Underpinning all activities is a robust funding position, with Tenon Group gearing at 68% and Total Water Group RCV gearing at 65%. With good liquidity, we maintain the ability to deliver on our strategy in UK water and are well positioned for a sustainable future. And with that, I will hand over to Laura.

Thank you, Susan. I'm Laura, and I'm pleased to be presenting my first page of results as CFO of Tenon, having taken on the role in July. Overall, we've delivered a resilient set of financial results for the first half of 2024-25, in line with the expectations we set out in our trading statement on 26 September. Headline EBITDA was £164 million versus £169 million in the previous period, with a contribution from SES partly offsetting the performance from South West Water, which was impacted by lower revenues from lower demand that Susan has talked about. Excluding SES, underlying EBITDA was down from $168.5 million to $150.2 million. Southwest Water's capital expenditure was a little over $300 million. As we continue to invest in improvements across our regions and our networks, as well as ensuring we are set up to deliver on the investment programme and improve service targets required for K8. Total group capex of £332 million reflects the inclusion of SES and Tenon Power. Shadow RCV across our water business is benefiting from growth of 45% over K7 in southwest water, higher than anticipated from PR14s, due to accelerated investment, along with regulatory corrupts and inflationary impacts, with group acquisitions driving 30% uplift, resulting in an overall increase in group RCP of around 75% over K7. As we have invested over the K7 period, through watershed, accelerated investments, marine recovery and so on, we are seeing the impact coming through the income statement of increased financing charges and depreciation. While this is not reflected in RCV through PR19, this will be trued up on 31 March through the regulatory adjustments and the revenue impact will also be trued up for the K7 shortfall as part of the K8 reset, broadly equal to £17 million of income statement uplift seen in the draft determination. Based on net debt at September, water group gearing, including southwest Bristol and now SES water, was 65%. Southwest water gearing, excluding SES, was 64%, both within our K7 policy. Return on regulated equity stands at 6% real for the K7 period to date and reflects strong financing and Totex performance, partially offset by reducing inflation and higher expenditure over the past six months. On a national actual balance sheet basis, Rory stands at around 10.8%. In line with Penon's 2020 to 2025 dividend policy for growth of CPIH plus 2%, The Board has declared an interim dividend of 14.69 pence per share for the half-year ending 30 September 2024. On a like-for-like basis, excluding SES, underlying group revenue was broadly flat at £450.6 million, with lower customer demand in southwest water, more than offsetting the benefit of tariff increases. Whilst impacting the current year, regulatory pricing mechanisms will ensure revenues are fully recovered over time. On a group basis, statutory and underlying revenue was up 17.5% to £527.2 million, benefiting from the acquisition of SES and growth in Penn on Water services. Like-for-like operating costs in the water business increased by 5%, reflecting inflationary pressures, continued high power costs, and costs associated with the implementation of a new customer billing system in Southwest Water. These were partially offset by efficiencies from our continued transformational and integration programs. Group operating costs increased 29.8% to £363.7 million, resulting from the full six-month consolidation of FES. Higher costs in Penn on Water services, reflecting higher wholesale supply costs consequent on the higher reported revenue, also resulted in increased group costs. Depreciation and amortisation increased year-on-year to £94 million, mainly as a result of the inclusion of SES alongside an increase in South West Water due to the Capital Investment Programme. This resulted in underlying operating profits reducing to £59.5 million from £85.9 million in the prior year. Like-for-like financing costs were broadly flat year-on-year, as lower inflation on index-linked debt benefit interest rates, offset by the impact of increased borrowing from the Capital Investment Programme. Group interest charges increased to £88.6 million, primarily due to the inclusion of £9.7 million of financing charges in SES. Our focus is now on reshaping and restructuring our operations for efficient delivery ahead of K8. We will recognise £16 million of restructuring costs as non-underlying charges across the year to enable a more streamlined delivery into the final quarter of this year and into K8. £3.7 million of these costs are recognised in the first six months of the year, with an expectation of £16 million of non-underlying costs for the full year. The Brixham incident resulted in non-underlying costs of £16.3 million, recognised in the first half of the year as a result of costs to support customers' water deliveries, customer compensation, and work to clean and restore the network. Finally, on a like-for-like basis, the group reported a statutory loss before tax of £34 million, compared with a profit before tax of £3.2 million in H1 2023-24. So let's drill down a bit more into revenue. Within Southwest Water, we're seeing the impact of our successful Water is Precious campaign, where we offer customers practical support on how to use water efficiently, both inside and outside the home. Reduced demand impacted revenue by £19 million, which more than offset the 3% benefit from tariffs increases. and resulted in a 2% reduction in South West Water revenue in the first half of the year. Penn and Water Services revenue increased by £8.7 million, driven by inflationary factors and new contract wins in the period. These two factors led to revenue excluding SES being broadly flat year-on-year at £451 million. SES contributed £76.6 million of revenue in the period, largely comprising the regulated water business and their non-household retail business, such that headline revenue for the group was up 17.5%. The movements in EBITDA broadly reflect the revenue impact in southwest water of lower demand. Cost pressures from non-commodity power costs, wage inflation of around 4%, and the new digital customer service platform have been partially offset by lower commodity power costs and efficiency savings, with around 10% overall reduction in southwest water EBITDA. Ten on water services EBITDA was up 19% to 3.7 million, and with a contribution from SES, baseline EBITDA was 163.5 million. Since the completion of the merger of Bristol Water, we've been delivering on our proven acquisition and integration blueprint. We are on track to deliver a run rate of around £20 million of annualised synergies by the end of the financial year, with £18.5 million achieved by half one to 24-25. The reshaping and restructuring activities we have initiated are vital for ensuring we have the right resources in the right places, focused on delivering our commitments for now and throughout K8. These activities are expected to deliver annualised profit savings of around £55 million when complete. We have over £35 million annualised savings in progress through both our operational initiatives to improve efficiency as well as our group-wide restructuring programme. £16 million of costs are expected across the full year related to these initiatives. In addition, we received clearance from the CMA in June 2024 for our acquisition of SES. We are aligning the SES businesses to the group structure and are on target to deliver around £11 million of annualised integration savings, with £2 million achieved in H1 2024-25. On a like-for-like basis, group capital expenditure in the first half was £319.8 million. And including SES, total capex was 331.8 million, up 65.5 million, or 24.6%, driven by a 71.6 million increase in South West Water investment and 12 million spend in SES. Investment reflects the ongoing focus on transitioning to K8, as well as delivering the final regulatory commitments for K7. With more resilient water resources, excellent progress on our state-of-the-art water treatment works in Bournemouth, and 100% water quality at Paising Waters, our investment is delivering benefits as we close out the regulatory period, and coupled with our strategy of consolidation in the UK water sector, has resulted in RCV growth of 75% over K7. SES capital expenditure of £12 million largely comprises £9.3 million spend in respect of the rollout of SES Water's metering programme. Investment in Tenon Power of £13.4 million reflects the start of construction at two sites with a significant ramp-up in activity anticipated in the second half of the year as the build programme accelerates. The around £32 million in the prior period was largely in relation to the cost of purchasing the site, a total of around £40 million in 2023-24. Group debt at 30 September 2024 was £4.4 billion, with over £675 million of liquidity available to the group. We were pleased to secure two strong investment-grade credit listings in the period, with a BAA1 rating from Moody's and BBB Plus from Fitch. These ratings enabled us to launch our EMTN program alongside our inaugural 400 million bond issuance in August 2024. Alongside a U.S. private placement, we have secured $550 million in new borrowings in the period, building on our diversified debt portfolio and standing us in good stead to ensure ongoing funding for our continued high level of capital investment across the K8 period. We will continue to target efficient funding streams, with South West Water's effective interest rate remaining relatively low for the sector at 5.3% and an average maturity of 14 years. We have a diversified mix of fixed, floating and index linked debt and use interest rate swaps to manage volatility and to align with the regulatory cost of debt allowances over the period. In preparation for K8, over 500 million of swaps have been put in place to fix our floating rate instruments. Given these developments in the half year, we are well placed to secure funding and maintain a diversified portfolio for the future. Looking forward, we will, of course, see the folio results of the SES acquisition in the outturn position. The outlook for Southwest Water Revenue sees a continuation of lower customer demand, offsetting tariff increases and new customer numbers, resulting in a balanced H1-H2 split and broadly flat year-on-year. Continued elevated non-commodity power costs, and the costs of the new digital customer services platform in Southwest Water are expected to be partially offset by increased efficiency savings realized with effect in the final quarter of 2024-25, meaning costs in Southwest Water are higher year-on-year and will continue to impact on profitability. We anticipate group capital expenditures for the full year to continue at the H1 2024-25 run rates, This reflects early work in preparation for K8, including 75 million accelerated investments in storm overflows agreed with Ofwat, as well as investment in responses to operational incidents such as Exmus and Brixham, a peak year for Penn on Power development costs, and the full year impact of SES investment. The impact of our ongoing capital programme on our debt position, in addition to SES's financing charges, is expected to increase Greek net finance costs for the full year, with a step-up in H2. The Water Businesses RCV for 2024-25 is expected to increase, reflecting continued high capital expenditure from additional and accelerated investment, as well as the finalisation of the K7 period. Thank you for your time. I will now hand you back to Susan.

Thank you, Laura. I'd now like to explain where we are against our priorities. The top priority for our customers is safe, clean drinking water across Bristol, Bournemouth, Devon, Cornwall, the Isle of City, and now certainly Surrey. We have been investing to protect water quality and enhance resilience, and we have broken the drought cycle for Devon and Cornwall well ahead of time. This has been a monumental undertaking with teams across the Isle of Water and our supply chain partners involved. That pool pit has been fully operational since March this year, with construction complete at the new treatment works at Rialton. That means for Cornwall, we have supplemented resources cumulatively since 2022 by 34%, with 4% extra delivery in this half year, having delivered a 30% uplift to Devon last year. With overall resource levels now at 80%, we accused 100% supply demand balance index for the first time in the 2023 EPA, turning that measure to green. There are always two sides to the coin, and reducing demand is key for future resilience. Our collective easing demand reduction schemes are focused on supporting customers to use less and save money. Easing with our Water is Precious water efficiency campaign has been targeting both residents and visitors. In Cornwall, residents were given £10 off their bills in delivering a 5% reduction in use. We are also trialling several firsts for the region with progressive Paris trials, seasonal and rising blocks. and early results are showing demand reductions for customers from between 2% and 9%. Whilst we are focused on protecting water resources, safe, clean drinking water remains customers' number one priority, and we continue to make good progress in rolling out our successful 41st culture and training programme to Bristol, with plans to extend it to certainly Surrey. The incident earlier in the year in Brixham highlights just how important that it is to all customers that they can have confidence in their water supply. We continue to work with the Drinking Water Inspectorate on the lessons learned from that incident. Our underlying water quality is improving. With SES the top performer in the industry and Douglas Water at Apple's portal for water-influenced companies, we are confident we can do more as we share best practices. For Bournemouth customers, we continue to make good progress using state-of-the-art off-site build techniques for our new water treatment works at Albany and Nat Mill, which will supply 85% of the Bournemouth population. In Devon and Cornwall, we are on track to finalise improvements at Stidion, St Mir, the Sawmall and in Orhampson, with tactical investments across Bristol ahead of significant investment in K8, showing improvements on last year's performance. Tackling stormwaves loads is a priority, and there's no doubt we've been challenged with the highest rainfall in the third west this October 2023 to August 2024 since records began. I said earlier this is not an excuse, but it is there for context. Groundwater levels have remained exceptionally high, with a corresponding increase in the headline number of stormwaves most filled. We are investing to make sure we can alleviate and eliminate the use of storm wafers and bring down the number of spills when we have higher rainfall. Our investments are working, having resolved two-thirds of our highest spills from 2023 and prevented around about 12,500 spills to 350 interventions. Importantly, we have maintained our sector-leading performance for internal sewer flooding and are reducing our external sewer flooding incidents, remaining an upper quarter of our performance, ensuring homes and businesses are protected. Our water fit investments, which we started in 2022, have been focused on reducing the flows into our network, with 57 kilometres of sewage relined to reduce infiltration. We've completed over 12 hectares of sewer separation. We've increased storage at 60 sites, nearly tripling our storage capacity to capture flows that otherwise would have been spilt, retaining them for treatment after the storm event. And we've increased treatment capacity at 15 wastewater treatment works. We've also been maximising existing capacity at 90 sites for interventions such as increasing wheel heights and flow optimisation. With 860 miles of coastline across our region, we are rightly focused on improving our bathing beaches, and on a like-to-like basis, we are maintaining 100% bathing water quality standards for the fourth year in a row. We've had six new designations made in 2024, and we're working to support catchment schemes to ensure that designations meet the highest standards. Three have already met standards, and the remaining three are where our assets have limited impact, so we're working to understand other upstream forces to support improvements. We continue to focus on reducing the number of spills at bathing waters, and despite the increased rainfall we've seen, the headline spill numbers have reduced by 12% during the bathing season. We also recognise, though, there is still much more to do on eliminating pollutions and spills. We have had some of the lowest absolute levels of serious pollutions across the sector, and we've not had a Category 1 incident since 2018. We remain focused on driving improvements to overall pollution levels for Devon and Cornwall. Increasing levels of Category 3 pollutions remains a top priority for everyone who works in wastewater services. Historically, the majority of pollution has occurred in the network, and the work we have done here is working with a 40% reduction in incidents from these over K7. We've achieved this by investing in 12,000 sewer deck monitors, supporting both predictive and proactive interventions, as well as continuing to invest in rising main replacements and sewer upgrades alongside supercharging maintenance and targeting cleansing activities. We've seen improvement to underlying performance at our treatment works, and our focus has now turned to our pumping stations, where resilience to the weather and increased flows has been challenging. We are responding with improved site motifs, and enhanced cleansing as well as tackling power resilience. We're also focused on upskilling teams so we are better equipped to mitigate and react to pollution events. We're improving river water quality at 37 sites with 8% reduction in phosphorus and have improved the reasons for not achieving the ecological status over K7 from 19% to 12%. Our award-winning catchment management programme is leading the way to biodiversity gains, as well as continuing to help the way others manage their land, improve water quality, biodiversity, and have climate resilience. The activities range from building ponds, improving farm tracks, to restoring as well as planting trees and buffer strips to catch and fill the water. With our commitment to net zero, our investment in Penn on Power has continued as nearly half of our targeted capacity are already under construction at two sites in Fife and Aberdeenshire. and we have appointed preferred partners at our two further sites. In terms of these assets, post-energisation on an unlevered basis are between 7% and 9%, and on a levered basis are between 11% and 15%. In tackling affordability, it is about doing two things, keeping bills as low as possible and supporting those who are vulnerable. By focusing on efficiency, we have kept bills below inflation, with a bill in the South West now than it was 10 years ago. with the average bill now less than £1.50 a day. And given you can't choose your water provider if you're a household, we believe you should have a say, which is why we plan to grow our unique WaterShare Plus scheme, as well as extend this to certainly Surrey customers for the first time. While bills are lower, we are supporting more customers than ever before, with over £140,000 benefiting from our support tariffs across the group. By unlocking over £110 million in financial support, we have increased affordability to 100% for customers in South West and Bristol, on track to meet our pledge of having zero customers in water poverty by 2025, five years ahead of the rest of the sector. Key to building trust is reducing complaints. With Bristol recognised as a top performer for customer service, we see opportunities for improving across the group, with South West reducing complaints by a key percent last year. an opportunity to share best practice with SES to improve customer service. We continue to support customers to use less and save more through our progressive charges trials. Against our customer commitments, about 70% of our ODIs are ahead or on track. And as outlined in our Thoughts Water Company Performance Report, we are delivering good relative performance in the sector. with our industry leading or upper quartile in several measures, including internal sewer flooding and unplanned outages for South West Water, quality and supply interruptions for certainly Surrey and customer service in Bristol. As we enter the next regulatory period, Ofwat's 2023-24 report indicates that companies in the group are in a relatively good position in respect of the common ODIs. And that's important because these are the measures that are retained for the new K8 period. On our non-regulated retailers, which now include SES Business Water, we continue to build on their strong performance with a combined market share of 15% and a strong EBITDA. Penal Water Services and Water Business have an outstanding focus on customer service. Their Trust Pilot scores are 4.8 and 5 respectively. Following the SES acquisition, which included other non-regulated businesses, we see opportunities for consolidation, efficiencies and sharing of best practices. We are energised by South West Water's outstanding status for our business plan and the good status for SES's plan, recognised by Off-Watch for draft determination. The draft determination provides a floor for RCV growth of 30% for the group. The cost of capital is protected against reduction between CD and SD. We are 30 basis points upside for South West Water if we meet four criteria and are five basis points upside for SES. One of the criteria is to achieve the EPA four-star status by 2028. We had one of the lowest levels of product reductions of any water and food company in the sector at around about 7%, reflecting the efficient business plan we submitted. And importantly, we received all of the funding for our storm overflow plans, allowing us to bring forward 75 million early start transition spend, which will be included in our March 2025 RCV with returns applied over K8. Given our outstanding status, our response to the draft determination has covered four areas of representation, many of which are consistent across the sector, ensuring a balance of risk and return with targets at stretching but achievable levels that show upper quartile performance in one area and substantially offset underperformance in another, and a return to the expenditure levels and RTV runoff set out in the plan. And lastly, ensuring our investments are balanced both regionally, nationally, and between wash and wastewater. The timetable is set to deliver the final determination on the 19th of December, and we look forward to holding a capital market day on the 25th of February to take over through our delivery plans. I've talked a lot today about how we are reshaping the group. We couldn't achieve any of our plans without the ongoing support of our teams and the support of our wider supply chain partners. When I reflect on Brixton, they say you see the best of people in the most challenging of times. We saw that in block it loads from all our colleagues as they gave up weekends and meetings to help customers in addition to doing their day jobs. From network technicians to engineers, water quality scientists, customer service and comms teams and contractors, over 800 colleagues came together as one team. In Manning, three bottle water stations, seven days a week, teams also hand-delivered over 390,000 bottles of water direct to customers, with customers receiving over 1.4 million bottles of water in total. Our customer services teams held 14 customer events in and around Brixham over eight weeks, and our mobile van visited communities over 40 times to be on hand to help. Our communication teams held briefings with the media twice a day throughout, and we are now working with the English Riviera Big Company to match fund their budgets and support a legacy project to support tourism. In reshaping the group, we are putting more resources on the front line than ever before. We are the only water company to be recognised as a top 100 employer for apprenticeships for second year running ahead of a plan to offer 1,000 apprenticeships and graduate roles by 2030. We've delivered over 4,000 courses that are a growing number of internal training facilities. In November, we were recognised for our earn and learn approach to development with platinum status awarded to us by the Five Frank Club, who show an ambition to take the future of workforce development and national prosperity. We continue to promote social mobility, giving young people the opportunity to dive into their local water company. It's very important in a region where deep-seated social mobility issues exist and where the South West ranks the third worst for upward occupational mobility. I'd like to thank everyone in the group for what they have delivered and for what we are about to do as we look ahead to K8. Supporting our ambitions are our supply chain partnership, Amplify, and that's already been stood up and is delivering on over 1,000 schemes. We have a robust financial position with good liquidity, having secured £550 million of funding in this first half year, which we use in a strong position to finance our largest ever investment programme, 2030. In summary... We are reshaping the business to enable us to deliver more for customers. We're focused on closing down K7, which record investments drive benefits in K8. We are well positioned as we look ahead to our next business plan and another period of significant growth.