Severn Trent reports 27% hike in profits before tax
Severn Trent Water reported a year-end group profit before tax up 27% at £384.7m for the 12 months to 31 March 2019. Sales were up £71m to £1,767 million boosted by tariff increases and £13.9m under the regulatory revenue correction mechanism.
Net finance costs were down £25.6m to £194.2m. A net gain on financial instruments of £16m was up from a net loss of £6.7m in the previous year.
Group profit before interest and taxation (PBIT) for 2018-19 was £573.6m – up 6.8% year on year
Excluding exceptional items gave an underlying PBIT of £563.3m. Exceptionals of £9.6m included an £8.9m cost from the legal requirement to offset gender inequality in guaranteed minimum pensions.
The company has restructured with moves that have shifted £55m of revenue from Severn Trent’s regulated business to its Business Service division.It has moved its sludge treatment activities from the Regulated Water and Waste Water operations and its renewable energy activities from the Business Service division into a single Bioresources business under Business Services. Also Severn Trent has ended the arrangement whereby property development activities were split between the regulated business and corporate operations in line with where the property development was made. They are now in a single proper development business in Business Services