Severn Trent reports investment momentum

(by Verity Mitchell)

Severn Trent has issued a trading statement for the period to 10 February 2026. It reported strong investment momentum for the current year. It expects to deliver towards the top end of its capital investment guidance range of £1.7bn-£1.9bn. The strategic rationale for accelerated investment is that improved performance will generate regulatory rewards more quickly.

Trading has been in line with expectations. The new chief executive, James Jesic, said: “We remain on track to deliver on environmental targets and meet the financial guidance set out at our interim results.” This includes £40m of rewards from outcome delivery incentives (ODIs) and price control deliverable (PCD) performance. The company expects to achieve all PCD milestones and associated rewards this year. Severn Trent’s management is also confident that the company will earn another 4-star Environmental Performance Assessment (EPA). This would be the seventh consecutive 4-star rating awarded to Severn Trent by the Environment Agency — a unique achievement among its peers.

At its capital markets day in March 2025, Severn Trent flagged that insourcing of activities, AI-enhanced project design and its ‘plug and play’ investment programme would be integral to deliver capital works at pace. At the beginning of AMP8, it was already guiding that it would generate £300m of operational outperformance over the five-year period.

Severn Trent will announce full-year results for the 12 months to 31 March 2026 on 20 May 2026.