SALESFORCE BRIEFING BUILDING ON A STRONG PLATFORM MARCH 2016

DISCLAIMER

For the purposes of the following disclaimers, references to this “document” shall mean higher cost for future service and growing deficit in relation to past service in the Defined this presentation pack and shall be deemed to include references to the related Benefit Schemes. speeches made by or to be made by the presenters, any questions and answers in relation thereto and any other related verbal or written communications. Forward looking statements should therefore be construed in light of such risks, uncertainties and other factors and undue reliance should not be placed on them. This document contains certain “forward-looking statements” with respect to Pennon Nothing in this document should be construed as a profit forecast. Group’s financial condition, results of operations and business and certain of 's plans and objectives with respect to these matters. All written or verbal forward-looking statements, made in this document or made subsequently, which are attributable to Pennon Group or any other member of the Forward-looking statements are sometimes, but not always, identified by their use of a Pennon Group or persons acting on their behalf are expressly qualified in their entirety date in the future or such words as “anticipate”, “aim”, “believe”, “continue”, “could”, by the factors referred to above. Pennon Group may or may not update these forward- “due”, "estimate“, “expect”, “forecast”, “goal”, “intend”, "may", “plan", “project”, “seek”, looking statements. “should”, “target”, “will” and related and similar expressions, as well as statements in the future tense. By their very nature forward-looking statements are inherently This document is not an offer to sell, exchange or transfer any securities of Pennon unpredictable, speculative and involve risk and uncertainty because they relate to events Group or any of its subsidiaries and is not soliciting an offer to purchase, exchange or and depend on circumstances that will or will not occur in the future. transfer such securities in any jurisdiction.

Various known and unknown risks, uncertainties and other factors could lead to Without prejudice to the above, whilst Pennon Group accepts liability to the extent substantial differences between the actual future results, financial situation development required by the Listing Rules, the Disclosure Rules and the Transparency Rules of the or performance of the Group and the estimates and historical results given herein. Undue UK Listing Authority for any information contained within this document which the reliance should not be placed on forward-looking statements which are made only as of Company makes publicly available as required by such Rules: the date of this document. Important risks, uncertainties and other factors that could a) neither Pennon Group nor any other member of Pennon Group or persons acting on cause actual results, performance or achievements of Pennon Group to differ materially their behalf shall otherwise have any liability whatsoever for loss howsoever arising, from any outcomes or results expressed or implied by such forward-looking statements directly or indirectly, from use of the information contained within this document; are changes in law, regulation or decisions by governmental bodies or regulators; non- recovery of customer debt; poor operating performance due to extreme weather and b) neither Pennon Group nor any other member of Pennon Group or persons acting on climate change; poor service provided to customers; global economic downturn their behalf makes any representation or warranty, express or implied, as to the pressuring volumes and margins; downward pressure on UK wholesale power prices; accuracy or completeness of the information contained within this document; and business interruption or significant operational failures/ incidents; non-compliance or c) no reliance may be placed upon the information contained within this document to the occurrence of avoidable health and safety incidents; failure or increased cost of capital extent that such information is subsequently updated by or on behalf of Pennon projects and/or Joint Ventures not achieving predicted revenues or performance; Group. exposure to contractor failure to deliver construction progress, increasing costs and potentially requiring lengthy legal action or other redress; reduced customer base, Past performance of securities of Pennon Group cannot be relied upon as a guide to the increased competition affecting prices or reduced demand for services; information future performance of any securities of Pennon Group. technology systems requiring replacement, development or upgrading to meet growing requirements of the business; an inability to raise sufficient funds to finance its activities or such funds only being available at higher cost; uncertainty arising from open tax computations where liabilities remain to be agreed and pension costs increasing due to

2 PENNON STRATEGY STRONG PLATFORM, EVOLVING FOR FUTURE

LEADING UK-LISTED ENVIRONMENTAL GROUP

Strategic priorities FOCUSED ON MOVING TOWARDS A MORE CONSISTENT RISK PROFILE

DELIVER FOR LEADERSHIP IN CAPITALISE ON INVESTING FOR CUSTOMERS, EFFICIENT COST GROUP-WIDE GROWTH COMMUNITIES, BASE AND STRENGTHS, ENVIRONMENT, FINANCING BEST PRACTICE, SHAREHOLDERS SYNERGIES

Strategic objective

LONG-TERM, PREDICTABLE, ASSET-BACKED, INDEX-LINKED RETURNS

3 PENNON’S BUSINESS SIGNIFICANT AND GROWING ASSET BASE

(3) £BN EFFICIENT, EFFECTIVE ASSET BASE REVENUE PROFILE Recyclate Water – 9 NHH Retail 5% 0% (4) 6 7 ERF power & Landfill 1%Competition Gas Recyclate 6% 5 ERF power and landfill gas 4

3 5 Recycling, landfill, Water Recycling,collections & contracts landfill, Wholesale collections17% and 2 and contracts HH Retail 1 Water 47% 1 ERF4 ERF -– not gate lt fees 3% 0 3 ContractsOther contracts - lt 9%

ERF2 ERF -gate lt fees 12% Water RCV (1) Viridor Asset Base (2) (1) 12% Long-term contracted Managed commodity exposure Varied contract lengths NHH Market Opening 2017

(1) RCV, plus RCV from 2015-16 onwards (2) Includes NBV of PPE assets, JV Shareholder Loans and IFRIC 12 Financial Assets UNDERPINNED BY LONG- (3) Revenue based on H1 2015-16, adjusted to include share of JV revenue and excluding landfill tax, IFRIC 12 construction revenue and revenue subject to natural offset within the Group (i.e. TERM INDEX-LINKED power and recyclate purchase costs) (4) Non-Regulated and Non-Household Retail Revenue (excluding wholesale charges) CONTRACTS 4 DELIVERING SHAREHOLDER RETURNS COMMITTED TO SECTOR-LEADING, SUSTAINABLE DIVIDENDS

+4% +4.9% annual increase +6.5% above RPI policy to 31.80 +7.3% 30.31 2020 +7.6% 28.46 26.52 Scrip dividend alternative 24.65

2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20 Note: Full Year dividend in pence per share

5 WHOLESALE WATER ON TRACK FOR OUTPERFORMANCE

• Enhanced business plan at PR14 Water and sewerage companies’ Return on Regulated Equity (RoRE) 2015-20

• Highest RoRE potential in the sector

• Track record of delivering efficiency

• RoRE at 11.5%(1)

Base returns in SWW Business Plan • Bournemouth Water integration on track

(1)As at H1 2015/16

6

WHOLESALE WATER ON TRACK FOR OUTPERFORMANCE

• Maintain cost leadership/ frontier H1 2015/16 Operational RoRE efficiency at PR19 TOTEX +2.2%

-1.5% +2.3% £12.5m • Building customer operational SIM 0.0%

quality -0.3% +0.2% £0.1m ODIs +0.3% • Focus on environmental -1.8% +1.5% performance and customer service £1.8m K6 Business Plan Commitment

• Strengthen/grow wholesale business

Note: Operational RoRE calculated from outperformance on Total Expenditure (TOTEX) compared to 2014 Final Determination allowances and performance on Outcome Delivery Incentives (ODI). Regulatory reporting requirements still to be confirmed by Ofwat for 2015/16 and therefore approach to calculating returns may be amended when further guidance is published 7 ENERGY RECOVERY FACILITIES (ERFS) PORTFOLIO OF ASSETS SERVING RESIDUAL WASTE MARKET

• Build out risk diminishing Operational ERF 2016-18 Consented facility

• 8 operational ERFs delivered

• Construction of 3 further ERFs progressing well

• On track to deliver c.£100m ERF EBITDA 16/17

• Supplies residual waste market

8

ENERGY RECOVERY FACILITIES (ERFS) LONG-TERM, PREDICTABLE, ASSET-BACKED, INDEX-LINKED RETURNS

ERF REVENUE

5% RECOVERED METALS

25% POWER OUTPUT

Pennon - natural hedge SWW/Viridor (c.25%) SHORT TERM

MEDIUM TERM CONTRACTED

WASTE FUEL 70% LONG TERM INPUT WASTE FUEL INPUT CONTRACTED (GATE FEES) (GATE FEES) (C.80%)

VIRIDOR HAS OVER 80% OF ERF REVENUES HEDGED OR CONTRACTED 9 LANDFILL AND LANDFILL GAS A SOLID EARNINGS STREAM FROM GAS, CAPITALISE ON VALUE OF SITES

CASH GENERATING BUSINESS • Simple, well-proven technology • Predictable gas volumes, steady decline, effective management of sales price risk

LANDFILL SITES BEING CLOSED TO WASTE INPUTS • Reducing from 17 sites to 3 strategic sites by 2020

CAPITALISE ON VALUE OPPORTUNITIES

• Industrial area/grid connections/decentralised energy - £8m Pilsworth cryogenic storage project, funded by Department of Energy & Climate Change (DECC) - Solar power opportunities, Westbury solar array operational

10

RECYCLING DRIVING TOWARDS MORE PROFITABLE RECYCLING

SECTOR CONTINUES TO FACE HEADWINDS • Current focus on comingled waste, but quality of waste input vital SEEKING OPPORTUNITIES TO DE-RISK AND RATIONALISE ASSETS • ITOO change programme – essential response • Contract management, pain/gain sharing on recyclate price exposure

OPTIMISATION

Comingled/ Processing Recyclate segregated Facilities waste

INPUT THROUGHPUT OUTPUT

11 NON-HOUSEHOLD RETAIL DEFEND AND GROW CUSTOMER BASE

• Merging SWW and BW Non-Household Retail business (based in Bournemouth)

• Standalone legally separated business

• Defend incumbent business and grow out of area

• Capitalise on Viridor footprint/order book/relationships/culture

• Winning Scottish customers

• Engage with plans for household retail deregulation

12 OUTLOOK UNDERSTANDING AND MANAGING THE REGULATORY ENVIRONMENT

WATER 2020 AND FUTURE REGULATORY REFORMS • Engaged in Water 2020 through “market place for ideas” • RPI / CPI is key debate - Lowest RPI index-linked debt in industry - Approach and pace of transition to CPI important

THE WASTE HIERARCHY AND CIRCULAR ECONOMY PACKAGE • Viridor well-positioned across the waste hierarchy • Strong in the residual waste market with its ERF portfolio • Recycling sector faces headwinds, but longer-term opportunities in growing market - EU Circular Economy package with 65% recycling target by 2030 is a long-term driver

13 APPENDIX PENNON OVERVIEW UNIQUE COMBINATION OF ENVIRONMENTAL UTILITY INFRASTRUCTURE ASSETS

VIRIDOR One of the leading UK , recycling and resource management companies providing services to more than 150 local authorities and major corporate clients as well as over 32,000 customers across the UK.

SOUTH WEST WATER SWW provides water and sewerage services to a population of c.1.7 million in and and parts of and Somerset. SWW was awarded enhanced status for its 2015-2020 business plan, meaning it has the highest potential returns in the water sector. SWW is already outperforming its business plan as at the end of H1 2015/16.

BOURNEMOUTH WATER Provides water services to a population of c.0.4 million in the Bournemouth and Christchurch region. Bournemouth was acquired in April 2015. Bournemouth Water is currently being integrated into SWW to deliver synergies and savings. The combined company is targeting frontier efficiency ahead of the 2019 Price Review. Bournemouth Water is one of the highest performing water companies with outstanding customer service and is also outperforming its business plan as at H1 2015/16.

15 PENNON – OLD STRUCTURE MULTIPLE LAYERS

Pennon Board of Directors

Pennon

South West Water Board Viridor Board

South West Water Viridor

Recycling / Wholesale Retail Energy Resource s Household

Non- Household

16 PENNON – NEW STRUCTURE DECISION-MAKING STREAMLINED

Pennon Board of Directors

Pennon Executive Board

South West Water Pennon Water (includes Bournemouth Viridor Services Water) (Non-Household Retail)

17 PENNON’S BUSINESS EARNINGS UNDERPINNED BY LONG-TERM INDEX-LINKED CONTRACTS

PENNON GROUP EARNINGS PROFILE (1)

Non-Household Retail Contracts, Recycling

Collections & Other(2) South West Water Landfill & Landfill Gas

Underlying Group EBITDA

ERFs(2)

(1) As at H1 2015/16 (2) Includes share of JVEBITDA and IFRIC 12 interest receivable 18 DRIVING FINANCIAL OUTPERFORMANCE FOCUS ON CONTINUOUS, SECTOR-LEADING EFFICIENCY AND EFFECTIVENESS

INITIATIVES UNDERWAY ACROSS THE GROUP • Base efficiencies in water –13.8%(1) Totex outperformance in 2015/16 (c.£29m Totex at H1 2015/16) • Bournemouth Water integration –1.7% per annum of Totex outperformance (c.£27m of net synergies for K6)(2)

• Further water initiatives – 0.4% per annum Totex outperformance (c.£2m per annum of Totex savings)(2)

• Viridor restructuring – enduring financial benefits of c.£9m per annum(2)

- Reducing central overheads

- Centralising and optimising sales force, logistics and fleet management

- Consolidating recycling operations ALONGSIDE DELIVERING IMPROVED CUSTOMER SERVICE AND ENVIRONMENTAL PERFORMANCE

MOMENTUM CONTINUING, DELIVERING AN EVEN STRONGER GROUP (1) Full year annual equivalent of H1 2015/16 performance (2) Exceptional Group restructuring costs of c.£10m recognised in 2015/16 to implement changes, with a two year payback 19

STRONG, SUSTAINABLE BALANCE SHEET STRONG FINANCIAL POSITION PROVIDING FLEXIBILITY

GROUP NET GROUP NET CASH/COMMITTED BORROWINGS GEARING(1) FACILITIES(2) £2,345m 62.6% £1,816m (30 September 2015) (30 September 2015) (30 September 2015)

SUSTAINABLE DEBT FUNDING • Diversified funding mix - large proportion of finance leasing • Fixed, floating, index-linked borrowings • Average debt maturity of 23 years (30 September 2015)

STRONG LIQUIDITY POSITION • Committed funding in place - SWW to March 2018 - ERF programme financed GROWING • Long-term banking relationships BALANCE SHEET HEADROOM POST (1) Net borrowings/(equity + net borrowings) (2) Including £211m of deposits with Letters of Credit providers and Lessors ERF BUILD-OUT 20

STRONG, SUSTAINABLE BALANCE SHEET SECTOR-LEADING FINANCE COSTS

PENNON EFFECTIVE INTEREST RATES 2014/15 AVERAGE INTEREST RATE ON NET DEBT K4 K5 K6 7.0% (2005-10) (2010-15) (2015-20) 7.8% 6.5% 5.1% 6.0% 5.1% 5.5% 5.0% 5.0% 4.9%

4.5% 4.7% 4.0% 4.1% 4.1% 3.5% 3.5% 3.0% SWW 3.3% SWW H1 2015/2016 3.2%

Pennon Water Sector SWW SUSTAINABLE AND EFFICIENT FINANCING – BALANCING RISK AND REWARD LOW COST • Floating rate debt fixed to protect against rate rises FINANCING • Managing maturities and refinancing UNDERPINS Source: Pennon calculation based on company Annual Reports

Basis: Net interest payable excluding pensions net interest, IFRIC 12 “interest receivable”, discount unwind on provisions and interest receivable on shareholder loans to joint ventures. OUTPERFORMANCE (Includes: , Dwr Cymru, , , South West Water, , , , , 21

INVESTING FOR GROWTH APPROACH TO CAPITAL ALLOCATION

GEOGRAPHY RISK PROFILE UK FOCUS, BALANCING LEVERAGING OUR RISK/REWARD SKILLS AND IN-LINE WITH EXPERTISE STRATEGY

BUSINESS FIT ORGANIC OR M&A CULTURE AND ALL GOOD VALUES IMPORTANT OPPORTUNITIES REVIEWED AND ASSESSED

22 DELIVERING SHAREHOLDER RETURNS BASE PLANS DELIVERING SUBSTANTIAL EARNINGS AND CASH FLOW

GROUP EBITDA(1) £M GROUP CASH GENERATED FROM OPERATIONS £M £m 700 700 ERFs contributing 600 600 significantly post - ERFs expected to contribute 500 500 build out 400 400 to 300 300 c.£100m EBITDA by 2016/17 200 200 411.0 100 100 0 0 407.3

(2) SWW RETURN ON REGULATED EQUITY (RORE) 11.5% 394.8

2012/13 2013/14 2014/15 K4 (2005-10) K5 (2010-15) K6 (H1 2015/16)

(1)Before exceptional items (2)Calculated from base equity returns allowed within the Final Determination plus outperformance delivered 23

SOUTH WEST WATER RECONCILIATION OF H1 2015/16 RoRE TO FINAL DETERMINATION (FD)

BASE ALLOWED RETURNS – 6.0%

COMBINED TOTEX OUTPERFORMANCE – 2.2% RoRE • Actual operating costs before depreciation (£106m) + actual capital expenditure (£58m) = £164m • Totex allowance(1)(2) assumed for H1 2015/16 = £193m • £29m Totex saving equates to £12.5m of RoRE benefit after applying company sharing rate and tax impact SIM OUTPERFORMANCE – 0.0% RoRE • Assumed no reward or penalty for 2020 in SWW, BW assumed to remain in upper quartile with £0.1m reward • Currently on track to deliver business plan targets in both businesses ODI OUTPERFORMANCE – 0.3% RoRE • Total net reward £2.2m(3), £1.8m net of tax • Rewards: bathing water quality, odour complaints, water restrictions, BW interruptions and leakage • Penalties: SWW duration of supply interruptions, pollution incidents FINANCING COST – 3.0% RoRE • Actual financing costs compared to FD allowances(1) REGULATED EQUITY • Based on notional gearing levels of 62.5%

(4) • Average 2015/16 RCV of SWW: £2,961m, BW: £150m

(1) Final Determination allowances are sourced from Ofwat published models at outturn prices. Regulatory reporting requirements still to be confirmed by Ofwat for 2015/16 and therefore approach to calculating returns may be amended when further guidance published (2) Assuming recognition of advancements and deferrals from Final Determination and non-appointed costs (3) 22% of ODIs are in period rewards/penalties. (4) Inflated using average RPI for the half year to 30 September 2015 of 1.0% 24

ENERGY RECOVERY FACILITIES (ERFS) ERF UNDER-CAPACITY CONTINUES TO 2030 AND BEYOND

UK COMBUSTIBLE RESIDUAL WASTE MARKET (MT)

30 Other ERF Capacity Viridor ERF Capacity UK ERF Under-capacity

25

20

15

10

5

0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Source: DEFRA, SEPA, NRW and Viridor analysis

25 ENERGY RECOVERY FACILITIES (ERFS) LONG TERM CONTRACT BASE, WHICH COVERS C.80% OF CAPACITY

VIRIDOR CAPACITY

Viridor capacity (operational & in construction)

Balance of short and medium-term contracts (Municipal and Commercial & Industrial)

De-risking - long-term contracts secured

Long-term contracts at the start of the ERF programme

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Source: Viridor Analysis

26 VIRIDOR MINIMISING RISK – MERCHANT BECOMES LONG TERM CONTRACTED

Planning & Permitting Plant Plant Contracted % Achieved Commissioning Operational Merchant % 100% 80% TRIDENT PARK ERF 60%

40% Fuel Load Fuel 20% 0%

Project Gwyrdd Project Gwyrdd in Project Gwyrdd Outline Bid Contract signed & Tomorrow’s Valley Trident Contracting Detailed Bid & Further Capacity Available Staged Stage Tomorrow's Valley Completed Final Bid Stage Status in Procurement 2010 2011/12 2013/14 2015/16 2017/18 2019/20

Clyde Valley Clyde Valley PQQ, Dunbar Contracting Preferred Bidder Clyde Valley Preparation ISOS & Detailed Further Tenders Expected & Contracting Submission Stage Status Complete

100%

80% DUNBAR 60% ERF

40% Fuel Load Fuel 20%

0% Planning & Permitting Plant Plant Source: Viridor Analysis Achieved Commissioning Operational 27 VIRIDOR DELIVERING THE ERF PROGRAMME, REDUCING CONSTRUCTION RISK

OPERATIONAL RAMP-UP AT NEW PLANTS LAKESIDE RAMP-UP

• Eight operational facilities Waste Inputs (tonnes) 500,000 • Managed operational ramp-up of the five new ERFs brought on-stream in 2014/15, the same 400,000 process performed at Lakeside 300,000 • Takeover of is now complete, with the plant delivered on time and below budget 200,000

• Transition from commissioning to full operational 100,000 performance at design capacity over c.12 months Design 2010 2011 2012 2013 2014 2015

• Targeting outperformance of design capacity over Power Exported (MWh) the life of each plant and world class utilisation 300,000 CONSTRUCTION OF THREE NEW ERFs PROGRESSING WELL AND TO BUDGET 250,000

• Glasgow ERF moving into early commissioning 200,000

• Dunbar and Beddington (South London) ERFs, 150,000 construction progressing well 100,000 Source: Viridor Analysis Design 2010 2011 2012 2013 2014 2015

28 VIRIDOR ERF ACCOUNTING

AN ILLUSTRATIVE, LARGE ERF (C.300KT) WILL CONTRIBUTE C.£28M TO VIRIDOR EBITDA

ILLUSTRATIVE ERF(1) IAS 16 IFRIC 12 JVs EBITDA £28m £12m -- IFRIC 12 Interest -- £16m -- Receivable IAS 16 IFRIC 12 JVs Share of JV EBITDA (50%) -- -- £14m • Oxford (Ardley) • • Lakeside Underlying EBITDA £28m £28m £14m • Cardiff • Glasgow • Runcorn I (Trident Park) • Peterborough(2) • Runcorn II • Dunbar • South London (Beddington) • Bolton • Avonmouth (1) From first full year of operation (2) Local authority funding, interest income will be negligible (not committed)

29 VIRIDOR ERFS (INCLUDING JOINT VENTURES)

PROGRESS ON ERF PIPELINE BASE LOAD CAPITAL MUNICIPAL ACTUAL/EXPECTED SITE COST (1) GROSS CAPACITY STATUS CONTRACT COMMISSIONING Tonnes Electricity ERF BUILD-OUT (000) MWe Lakeside(3) 150 410 38 Fully operational Merchant Commissioned NEARING Fully operational COMPLETION Bolton N/A 120 9 Greater Manchester Commissioned Exeter 48 60 3 Fully operational Exeter Commissioned Operational ramp-up Oxford (Ardley) 204 300 24 Commissioned

Cardiff Operational ramp-up Gwyrdd 207 350 28 Commissioned (Trident Park) (SE Wales) Operational ramp-up Runcorn I(3) 236 375 28(5) Greater Manchester Commissioned

Operational ramp-up Runcorn II 217 375 41 Merchant Commissioned

Peterborough 72 80 7 Operational ramp-up Peterborough Commissioned Moving to early Glasgow 155 200 15 Glasgow H1 2016/17 commissioning Construction in Merchant (Preferred Dunbar 177 300 23(6) H2 2017/18 progress Bidder Clyde Valley) South London Construction in 199 275 26 S London H1 2018/19 (1) Capital cost excludes capitalised interest and for projects for which the progress Engineering Procurement Construction (EPC) contract has not yet (Beddington) been executed, capital cost may vary in accordance with the Euro Sub Total 2,845 242 exchange rate (2) Operational period post construction. This is usually the minimum Planning permission guaranteed plant life Avonmouth(4) 233 350 28 TBA TBA (3) Joint ventures economic interest (Lakeside 50%; Runcorn I 37.5%) achieved (4) Project is not yet committed (5) Plus heat 51MWth Grand Total 3,195 270 (6) Plus heat 17MWth

30 VIRIDOR SUBSTANTIAL ONGOING ERF CAPEX(1)

CUMULATIVE CAPITAL CUMULATIVE REMAINING TOTAL ORIGINAL SPEND AT INVESTMENT SPEND TO SPEND TO PROJECT PLANNED £M 1 APRIL 2015(2) H1 2015/16 30 SEP 2015 COMPLETION SPEND PROJECT SPEND ERF projects in operation Exeter 47 1 48 - 48 47 Oxford (Ardley) 203 1 204 - 204 210 Cardiff (Trident Park) 207 - 207 - 207 223 Runcorn II 207 10 217 - 217 216 Total 664 12 676 - 676 696 ERF projects under construction Glasgow 121 7 128 27 155 155 Peterborough 53 13 66 6 72 72 Dunbar 11 23 34 143 177 177 South London (Beddington) - 30 30 169 199 199 Total 185 73 258 345 603 603

Total 849 85 934 345 1,279 1299 Peterborough financed by local (53) (13) (66) (6) (72) (72) authority Total impact on net debt 796 72 868 339 1,207 1,227

• £20m of efficiencies realised across capital investment programme

(1) • Debt includes £868m for Runcorn II / Exeter / Oxford / Cardiff / Glasgow / Dunbar / South London

(1) Excluding capitalised interest, £2m in H1 2015/16 and £60m cumulatively to 30 September 2015 (2) Including capital investment reclassified from construction in progress

31 SALESFORCE BRIEFING BUILDING ON A STRONG PLATFORM MARCH 2016