Steady as she goes at Severn Trent

MIDLANDS water company Severn Trent has said that trading across the group has been in line with its expectations.

In an interim management statement for the period April 1 to July 15,  the Coventry-headquartered utility said it has continued to manage its bad debt effectively, with its forecasted bad debt level maintained at around 2.2% of turnover for the full year.

It said it continues to monitor developments which could affect supply levels – such as unemployment levels and changes to the UK benefits system – closely.
 
Operating expenditure continues to be in line with the board’s expectations for the year but are expected to rise year on year due to the impact of inflation and increases in “quasi taxes” and power costs. This will be partially offset by efficiency improvements.
 
“We have made good progress in delivering our capital investment programme. Expectations for net capital expenditure remain in the range £510m to £530, including an estimated £15m related to private drains and sewers,” the firm said.

“The level of net infrastructure renewals expenditure included in this range is anticipated to be £125m to £135m.”

In June Severn Trent submitted a revised business plan to industry regulator Ofwat after pledging a further £125m to ensure it maintains supplies to Birmingham.

The plan, which covers the period between April 2015 and March 2020, had to be resubmitted after Ofwat demanded to know more about the so-called ‘Birmingham resilience project’.