TWO of the region's water groups reported contrasting fortunes in their recent performances.

AWG posted a 15 per cent fall in half-year profits as it announced plans to sell the bulk of its global business during the next six months.

But utility group Kelda said a strong performance from its Yorkshire Water business had contributed to a 5.8 per cent rise in profits.

AWG, which owns Hartlepool Water, said the profits fall to £46.4m was mainly due to increased interest charges offsetting an improved group operating profit of £166.4m, compared with £115.1m a year ago.

The Huntingdon company said its strategy of focusing on the UK meant it would be disposing of all its major interests abroad, including businesses in Australia, New Zealand and Scandinavia.

The firm hopes to build its UK water and support services business, including Anglian Water, which represents 91 per cent of group turnover of £924.7m.

For Kelda, the dry summer and autumn boosted demand for water among households while the company also made a gain of £14.6m from the sale of its waste recycling group.

Chairman John Napier said he was hopeful of a positive end to discussions with industry regulator Ofwat over its pricing review for the 2005-2010 period.