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Ses-Water-Annual-Report-2020.Pdf SES Water Delivering more Annual Report and Financial Statements 2020 than water Annual Report and Financial Statements 2020 Who we are Key stories of the year We are a local water supplier providing an essential public service while playing an active Hear from role in the communities our new CEO Read more on page 5 we are privileged to serve. Strategic report Financial statements 01 Highlights 88 Independent auditors’ report 02 At a glance 94 Financial statements Our performance 04 Chairman’s foreword 98 Notes to the financial statements 05 CEO’s statement this year 08 Market review Regulatory reporting Read more on page 16 10 Business overview 116 Annual Board statement 12 Our business model 122 Statements of the directors 14 Our stakeholders 126 Regulatory accounts 16 Operating review 127 Independent auditors’ report 22 Our aims 130 Regulatory statements and notes 32 Customer Scrutiny Panel report 159 Commentary on financial metrics 34 Our future plan 160 Notes to the regulatory accounts 36 Working in the public interest 40 Financial review 42 Principal and emerging risks 44 Managing risks 47 COVID-19 risks Governance 48 Introduction to governance 50 Board directors Working in the 52 Corporate governance report 65 Nomination Committee report public interest 67 Remuneration Committee report Read more on page 36 79 Audit Committee report 84 Directors’ report 87 Statement of directors’ responsibilities in respect of the financial statements SES Water Strategic report Annual Report and Financial Statements 2020 Governance 1 Financial statements Regulatory reporting Highlights Operational highlights Strategic highlights Leakage target met Customers on our − We have met the majority for 21st successive year Water Support Scheme of our annual performance commitments, finishing the 2015 to 2020 price review period in a strong position ML/day 23.9 14,311 − We accepted Ofwat’s Final (2019: 24.1ML/DAY) (2019: 10,401) Determination on our Business Plan for 2020 to 2025, agreeing TARGET LIMIT: 24.0 TARGET: 5,000 our performance commitments and customer bills for the five- year period − Our ongoing targeted approach Customer contacts about Burst to asset investment means our customers benefit from a more their water quality mains robust service − Our customer transformation programme has continued 329 172 with our brand new Company website going live and significant (2019: 388) (2019: 255) investment in a new billing TARGET LIMIT: 350 TARGET LIMIT: 290 and customer relationship management system launching later this year − We have achieved Investors in People Silver accreditation which reflects the many great things Financial highlights we do to lead, manage, develop and support our employees Bills to fall by Capital investment − Our top priority in the response to COVID-19 has always been to put the health and wellbeing of our employees and customers first, while striving to do the right 15.6% £35.6m thing and continue to supply high- IN NEXT FIVE YEARS 2019: £25.3M quality water all day, every day − Our new charitable fund, launched in partnership with the Community Foundation for Surrey, has seen Revenue Dividend paid us donate more than £30,000 to support many good causes in the areas we serve £69.8m £6.7m − Our successful education programme has continued, 2019: £68.3M 2019: £3.7M engaging with more than 12,000 people across our supply area − Our unwavering focus on Profit before tax vulnerable customers means we are now helping more people £10.7m in more ways than ever before 2019: £9.4M 2 At a glance Understanding SES Water Our vision Our values To be an outstanding Our values define who we are, guide our behaviours water company that and underpin everything we do. delivers service excellence. Service We put our customers first and take pride in our service delivery. Our purpose To supply our customers with Commitment We are passionate about our work, act responsibly the highest-quality water all day, and care about quality. every day, in a reliable and safe way, and to do so in a manner Innovation that reflects our long-term We seek to improve our business, to be forward commitment to serve our local thinking and to embrace change. community and environment. Integrity Read more on page 116 We are accountable, ethical and trustworthy. Collaboration What we do We are respectful, welcome diversity and support We supply around 160 million each other to achieve our goals. litres of clean water every day Compassion to more than 735,000 people We care about the effects of our actions and make in parts of Surrey, Kent, West a positive impact on the community Sussex and south London. Our business in numbers Number of Water coming from Water from employees underground sources our reservoir 310 85% 15% SES Water Strategic report Annual Report and Financial Statements 2020 Governance 3 Financial statements Regulatory reporting Where we operate Our supply area is 322 square miles extending from Morden and South Croydon in the north Sutton to Gatwick Airport in the south and from Cobham, Leatherhead and Dorking in the west to Purley Edenbridge in the east. Cobham Coulsdon Leatherhead Caterham M25 Dorking Reigate Redhill M23 Edenbridge Horley Gatwick Airport 2020 to 2025 High-quality water all day, every day Business Plan Our plan for the next five years has been developed in partnership with our Fair prices and help when you need it customers and sets out the investment we will make to improve our service and deliver more of what matters to them. It includes five pledges for us to deliver: A service that is fit now and for the future Read more on page 34 Excellent service, whenever and however you need it Support a thriving environment we can all rely upon Litres used per Water Water Litres of water person per day restrictions treatment works supplied daily 153 0 8 160m 4 Chairman’s foreword We have achieved industry leading performance in areas we know are critical to our customers. Jeremy Pelczer Chairman The purpose of our Annual Report our emissions and contributing to Ian’s appointment follows the is usually to look back on our the industry’s commitment to achieve retirement of his predecessor, performance over the previous year. net zero carbon emissions by 2030. Anthony Ferrar, in February 2020. However, I am going to start with However, we know that we have more I would like to personally thank where we are today – dealing with the to do in some areas, notably to improve Anthony for his considerable COVID-19 pandemic that continues customer and developer satisfaction. contribution and leadership of to have such a significant effect on The introduction of the new industry- the Company over the last 11 years. all of us. We have met the challenges wide measures of customer and presented to date with an unwavering developer satisfaction will rightly Ian’s arrival came shortly after focus on our customers and I am set the bar even higher but the Board Ofwat’s Final Determination on our proud of our dedicated employees is determined that we will reach it. Business Plan for 2020 to 2025. It who have worked tirelessly to provide followed a long and complex period a high level of service – my sincere Another key focus as a Board over of engagement with our regulator, thanks to all of them. the last year has been to continue to but I am confident that we have implement an enhanced governance struck a reasonable balance between I hope that our actions during this agenda and increase the transparency keeping bills affordable and investing difficult period will further enhance of our decision-making. Minutes of all to increase the long-term resilience of the trust of our customers and the our Board meetings are published on our service. You can read more later communities we serve. Our core our website and we have agreed new about the ambitious targets we have values have clearly been at the fore dividend and executive remuneration set and we’ll report on our progress and our purpose, to go beyond policies, with a strengthened link to in our future annual reports. providing an essential public service customer service and performance. and to play an active role in society, We have improved the visibility As I look ahead to the coming year, has never been more pertinent. around our dividend and remuneration as our communities and the economy The crisis has brought with it many decisions and you can read in this recover and rebuild, we will continue challenges for us, beyond the on-the- report about how we agreed the to provide all our customers with a ground operational response, so our level of dividends and how our high-quality and reliable service, while priority as a Board will be to navigate executives were remunerated. striving to meet our new performance the Company through these difficult targets, although the delivery of some times and ensure that we meet all I am delighted that Ian Cain joined may be challenging in the short-term our stakeholder expectations as we us in February 2020 as our new Chief because of COVID-19. It is a time all start to recover from its impact. Executive Officer, after a rigorous when strong leadership, effective and extensive search. Ian has very decision-making, transparency and I am very pleased to report that over broad experience within the utility collaboration will be critical, and as the last year we’ve achieved industry sector with a particular focus on ever we are well placed to succeed. leading performance in areas we delivering excellent customer service know are critical to our customers.
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