Exceptionals slash Severn Trent profits
Costs related to service charges and financial instruments have led to a 35.4 per cent year-on-year fall in pre-tax profit at Severn Trent.
The Coventry company posted pre-tax profit of £65.3m for the six months to 30 September 2011, despite recording a 2.1 per cent rise in revenue to £886m.
Pre-tax profit before interest and tax was £254.8m, down from £277m. Factoring in finance costs its profit was £155m, down from £158m.
However, an exceptional operating charge of £19.5m, and losses on financial instruments of £70.2m – up from £50.7m last year – resulted in the final reduced profit figure.
However Tony Wray, chief executive Severn Trent, said the results were "solid".
"Group revenue was up 2 per cent period on period with underlying group PBIT down slightly, reflecting increased investment in our networks in Severn Trent Water.
"We remain focused on improving the services from our networks. We have increased our network replacement activity underpinning our plans to improve network serviceability, supply availability and unplanned interruptions. We are maintaining our leakage activity levels following the severity of the last three winters."
