Interim Management Statement (6008X)
17 February 2012 - 6:00PM
UK Regulatory
TIDMSVT
RNS Number : 6008X
Severn Trent PLC
17 February 2012
17 February 2012
Severn Trent Plc Interim Management Statement
for the period 1 October 2011 to 16 February 2012
The Board of Severn Trent Plc confirms that trading across the
group has been in line with its expectations. No new material
trading events or transactions have occurred during the period 1
October 2011 to 16 February 2012.
Severn Trent Water
Consumption levels across our measured income base for FY
2011/12 are expected to lower year on year, in line with the trend
seen in the first half.
The level of bad debt for the full year is expected to remain
broadly stable compared with the first six months, although we
continue to monitor future developments closely, especially
unemployment levels.
Operating expenditure continues to be in line with the Board's
expectations for the year, and below the level allowed in the Final
Determination. Operating costs are expected to rise year on year,
due to the impact of inflation, prudent investment in our networks,
and quasi taxes (including the CRC levy), partially offset by
efficiency savings.
Expectations for net capital expenditure (UK GAAP after
deducting grants and contributions) remain in the range GBP450
million to GBP470 million. The level of net infrastructure renewals
expenditure included in this figure is anticipated to be GBP120
million to GBP130 million. Both figures exclude the costs of
Private Drains and Sewers (PDaS).
Severn Trent Water is not currently predicting any usage
restrictions this year, despite record low rainfall over the winter
period. This situation remains under constant review however and
the company is taking steps to improve supply resilience this year.
Severn Trent Water has maintained its focus on continuous
improvement and is on course to meet its 2011/12 leakage target.
Severn Trent Water is one of only 3 companies that is targeting
reduced leakage year on year over the current regulatory
period.
Work volumes related to Private Drains and Sewers continues to
be at the lower end of initial expectations. The company will
provide FY 2011/12 costs, and updated capital and operational
expenditure estimates for the remainder of the current regulatory
period, with its Preliminary Results in May.
Severn Trent Services
Severn Trent Services is expected to deliver an improved second
half performance, compared to the first half, in line with prior
guidance. However, markets remain challenging, with no significant
upturn expected before the start of the next financial year.
Group
The group completed a successful GBP250m 30 year bond issue in
January, at a coupon of 4.875%, and simultaneously a tender offer
for its 2014 GBP200m bond, which saw an uptake of 75% or GBP151m.
The costs of the tender offer will give rise to an exceptional
finance charge of GBP16m for FY2011/12, representing the difference
between the purchase price and the carrying value of the bond.
The expected effective current tax rate for the group for FY
2011/12 remains at 26% to 27%.
Severn Trent Plc will announce its preliminary results for the
financial year ending 31
March 2012 on 30 May.
Enquiries:
0207 353 4200 (on the
Mike McKeon Severn Trent Plc day)
Finance Director 02477 715000
0207 353 4200 (on the
Rob Salmon Severn Trent Plc day)
Head of Communications 02477 715000
0207 353 4200 (on the
John Crosse Severn Trent Plc day)
Head of Investor Relations 02477 715000
Anastasia Shiach / Martha
Kelly Tulchan Communications 0207 353 4200
Forward-Looking Statements:
This document contains certain 'forward looking statements' with
respect to Severn Trent's financial condition, results of
operations and business and certain of Severn Trent's plans and
objectives with respect to these items.
Forward looking statements are sometimes, but not always,
identified by their use of a date in the future or such words as
'anticipates', 'aims', 'due', 'could', 'may', 'should', 'expects',
'believes', 'intends', 'plans', 'potential', 'reasonably possible',
'targets', 'goal' or 'estimates'. By their very nature
forward-looking statements are inherently unpredictable,
speculative and involve risk and uncertainty because they relate to
events and depend on circumstances that will occur in the
future.
There are a number of factors that could cause actual results
and developments to differ materially from those expressed or
implied by these forward-looking statements. These factors include,
but are not limited to, changes in the economies and markets in
which the group operates; changes in the regulatory and competition
frameworks in which the group operates; the impact of legal or
other proceedings against or which affect the group; and changes in
interest and exchange rates.
All written or verbal forward looking statements, made in this
document or made subsequently, which are attributable to Severn
Trent or any other member of the group or persons acting on their
behalf are expressly qualified in their entirety by the factors
referred to above. Severn Trent does not intend to update these
forward looking statements.
Nothing in this document should be regarded as a profits
forecast.
This document is not an offer to sell, exchange or transfer any
securities of Severn Trent Plc or any of its subsidiaries and is
not soliciting an offer to purchase, exchange or transfer such
securities in any jurisdiction. Securities may not be offered, sold
or transferred in the United States absent registration or an
applicable exemption from the registration requirements of the US
Securities Act of 1933 (as amended).
This information is provided by RNS
The company news service from the London Stock Exchange
END
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