UU’s Capital Markets Day did not provide guidance on possible outperformance in AMP7, nor is such guidance likely at FY20 results in May. However, UU is already implementing plans for AMP7, and there was a level of confidence expressed by management that the company is positioned to deliver against totex allowances, ODIs, and financing. The totex run rate exiting AMP6 is at AMP7 allowed levels, which leads us to believe that UU’s comments around efficiencies should translate into AMP7 totex outperformance (Figure 1), something we view as supportive of our 5% outperformance assumption. Common ODIs are a stretch (Figure 2), but UU is looking well positioned on the newly introduced C-MeX (Figure 3) measure, while bespoke ODIs have a slight positive skew (Figure 4). Our £25m ODI revenue assumption over AMP7 might prove to be conservative. Positive message on financing. Our assumptions assume a 20bps halo effect on new funding, but UU has alluded to typical outperformance levels of 50-100bp on new debt (Figure 5). Raising our halo effect assumption for AMP7 to 75bps would add 9p/share to our valuation. Minor tweaks to our estimates reflect updated inflation numbers, and the recently announced AMP7 dividend policy, but our target price is unchanged at 1,035p. We view UU as a defensive name in these uncertain times, but one which appears well positioned to deliver in the next regulatory period. We reiterate our Buy rating.