2 Segment reporting
The group’s revenue predominantly arises from the provision of services.
For management purposes, the group is organised into two principal operating divisions, being regulated and non-regulated activities. These divisions form the basis on which the primary segment information is reported.
The regulated activities segment includes the regulated results of United Utilities Water PLC.
The non-regulated activities segment includes the group’s utility outsourcing contracts in the United Kingdom and overseas.
In addition, the other activities segment includes the results of United Utilities Property Solutions Limited, United Utilities Group PLC and other group holding companies.
Trading between segments is carried out on an arm’s-length basis and transactions are priced accordingly. External market prices are used where available; where not available, margins generated are compared to those generated from external sales and adjusted where necessary.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items mainly comprise interest bearing cash and borrowings and taxation related assets and liabilities.
Of the group’s consolidated revenue and net assets for continuing operations, greater than 90 per cent of revenue is derived from customers located in the United Kingdom and greater than 90 per cent of the net assets are located in the United Kingdom, for both of the years ended 31 March 2009 and 31 March 2008 and, hence, no geographical analysis is presented.