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THAMES Water has been hit with an £8.55 million fine for missing leakage targets.

The penalty is the second the utility giant has been ordered to pay this year and comes as its annual report revealed that profits have slumped by 86 per cent.

The firm was ordered to pay a record £20 million fine in March for polluting the River Thames with 1.4 billion litres of raw sewage between 2012 and 2014.

However in the latest report and accounts it sought to reassure customers in Wiltshire by detailing investment amounting to hundreds of millions of pounds across the county, including replacing mains between Farringdon and Blunsdon.

In a separate announcement today/yesterday (WED) industry regulator Ofwat announced the firm's second fine this year, the maximum amount that can be imposed for the specific failure to meet national leakage reduction targets.

Cathryn Ross, the watchdog's chief executive, said: "The failure by Thames Water to meet the leakage commitments it has made to its customers is unacceptable. Our performance commitment regime imposes significant penalties for failure to deliver the levels of performance that customers have paid for and consequently Thames Water will now face the maximum penalty."

The firm faced criticism in March when an alleged water main caused flooding in Redcliffe Street, Rodbourne. One resident claimed that a pool of water in the road was not addressed for three months. Thames Water responded that it was ground water not related to its network.

Nationally, the water company missed its target for cutting leaks by 47 million litres a day.

The report revealed more gloomy news with pre-tax profits slumping to £71.1 million for the 12 months to March 31, from £511.2 million the previous year.

However the accounts, published today/yesterday (WED), showed that chief executive Steve Robertson picked up a £54,000 annual bonus despite the woes.

The company said the potential amount was cut down in light of its performance.

Investors were also paid £100 million in dividends in the 2016-2017 financial year.

As it sought to win round customers in Wiltshire the company said that it had invested £25 million in the Axford pipeline in Swindon to protect the River Kennet by reducing the amount of water taken from the chalk stream.

A further £764,228 was invested as part of the Farringdon to Blunsdon mains replacement, which will help supply people with water in Swindon and Oxford. Across Wiltshire it spent £138,360 replacing and repairing strategic valves, which control the flow of water to customers’ taps.

Mr Robertson said: "I am excited about this new chapter for Thames Water, with a fresh leadership team and new investors on board.

"We fully accept our responsibility for our legacy issues and our focus now is to ensure resilience in our provision of essential services and delivering maximum value for our customers, who continue to benefit from the third cheapest bills in England and Wales."