Severn Trent Plc (LON:SVT) has announced a trading update for the period to 4 February 2021.
Positive momentum carried through the winter
Severn Trent continues to deliver strong operational performance and resilient financial results.
– Customer performance – We are committed to delivering the best possible service to our customers and despite being set challenging targets for this year we have invested wisely and worked tirelessly to outperform. In Water we remain on track for our best ever performance on a number of measures including the Compliance Risk Index and water quality complaints. In Waste we have started the AMP1 strongly with 25% fewer blockages and a 15% reduction in pollutions in the calendar year. Our biodiversity programme is on track to deliver over 2,200ha of enhanced natural environment, delivering our five-year target in the first year of the AMP1.
We remain on or ahead of target for almost 80% of our customer performance measures and so we are pleased to increase our guidance for outperformance on Customer ODIs2 this year from ‘at least £25 million’ to ‘at least £50 million’.
– Stable outlook for the full year – We remain confident of delivering our full-year results in line with expectations and prior guidance. The Severn Trent Plc Board confirms this year’s final dividend in line with our AMP71 policy.
Green Recovery investment opportunity
We are in constructive dialogue with Ofwat and DEFRA on potential investment opportunities for Severn Trent as part of the Government’s Green Recovery initiative. We submitted a number of proposals3 on 31 January and look forward to continuing our discussions during the review process, which we expect to conclude by September 2021. As well as providing meaningful RCV4 growth on top of our c.4% growth rate for AMP71, we believe our proposals would support our environmental ambitions, create much needed jobs in our region and support national sustainability objectives on climate change, flood resilience, river water quality and water consumption.
Supporting Net Zero and nature
We are proud to be supporting the UN Race to Net Zero campaign through our Triple Carbon Pledge. We continue to make good progress and will give more detail on our journey to net zero at our Capital Markets Day later this year. Our approach to long-term sustainability has always placed nature and our communities at its core and so we are pleased to add our support to the recently launched Terra Carta charter putting nature, people and planet at the heart of creating value.
Ongoing support for our community
The challenges currently facing our customers and communities as a result of the pandemic are never far from our thoughts. To date we have helped more than 120,000 customers who are struggling to pay their bills and we are providing a range of flexible schemes to support them as their circumstances change. More broadly, we continue to support local projects, with £2.4 million now awarded to 384 community organisations to help where it is needed most. At our half-year results we announced our ambitious plans to support the Government Kickstart Scheme with 500 opportunities, and we are pleased to announce that we welcomed our first cohort of Kickstarts into the business in January 2021.
Financial calendar
Full-year results – Severn Trent’s annual results presentation will take place on 26 May 2021.
Capital Markets Day – Severn Trent will be hosting a Capital Market Markets Day on 24 September 2021.
