Trading Statement

SEVERN TRENT PLC

PRE-CLOSE PERIOD TRADING STATEMENT

3 APRIL 2007

Severn Trent Plc is issuing the following trading update prior to announcing
its full year results on Wednesday 6 June 2007.

The Board considers that the Group has delivered a trading performance in the
year which is consistent with its expectations.

The integration of the Plc head office and Severn Trent Water teams is
progressing. As part of this, and as previously announced, the Severn Trent Plc
and Severn Trent Water Boards of Directors, whilst separately constituted, now
have the same membership.

Management is developing plans to identify improvement opportunities across all
areas to achieve higher standards. These process improvements are expected to
result in staffing levels (permanent and agency) in Severn Trent Water being
reduced by around 600 posts over the next five years. Further details of our
improvement plans will be outlined at the full year results announcement in
June.

Water and Sewerage

Profit Before Interest and Tax (PBIT) for Severn Trent Water for the year is
expected to be some 1% - 3% higher than the prior year (£400.4m), consistent
with prior guidance.

Infrastructure renewals expenditure at Severn Trent Water is expected to be in
the region of £95m - £100m for the year.

Gross capital expenditure under UK GAAP, (including infrastructure maintenance
expenditure) is expected to be around £500m for the full year 2006/07.

Following the restructuring of the Group last year, management is now focusing
on improving performance in the Water business. While performance has been good
with respect to water quality and health and safety, Severn Trent Water has
needed to improve in respect of leakage, customer service and controls.

Following a challenging summer focused on maintaining water supplies, increased
investment in leakage control has delivered a downward leakage trend. It will
be some months before the annual average for 2006/07 can be determined against
the Ofwat target but in March Severn Trent Water achieved a weekly level of
leakage commensurate with the Ofwat target for 2006/07.

Severn Trent Water's raw water storage position is normal for this time of
year.

Water Technologies and Services

This business segment includes Water Purification, Operating Services and UK
Laboratories. Trading has shown consistent growth and PBIT for the year is
expected to be some 11% to 13% ahead of last year (£17m).

Corporate and Other businesses

Corporate overheads are expected to be around the same level as that incurred
in 2005/06 (£22m). Plans are well advanced to deliver the previously announced
£6m to £10m reduction in overhead costs over the next 18 months.

For other businesses, the PBIT loss for the full year is expected to be between
£1m and £2m.

Interest and debt

Net interest payable for the year is expected to be around £165m. Net debt at
the year end (excluding IAS39 fair value adjustments) is expected to be around
£3.2 billion. RCV at 31 March 2007 will be £5,530m, resulting in an expected
net debt to RCV of around 58% at the year end.

Ordinary shares

Following the share consolidation of Severn Trent Ordinary Shares on 9 October
2006, the weighted average number of shares outstanding (for the purposes of
calculating basic earnings per share) is expected to be around 232 million.

ENQUIRIES TUESDAY 3 APRIL 2007:

Mike McKeon                    Severn Trent      0207 353 4200     
                                                                   
Group Finance Director                                             
                                                                   
Jonathan Davies                Severn Trent      0207 353 4200     
                                                                   
Head of Investor Relations                                         
                                                                   
Peter Gavan                    Severn Trent      0121 722 4273     
                                                                   
Director of External Affairs                                       
                                                                   
David Trenchard                Tulchan           0207 353 4200     
                                                                   
Peter Hewer                                                        
                                                                   

AFTER 3 APRIL 2007:

Mike McKeon                    Severn Trent      0121 722 4319     
                                                                   
Group Finance Director                                             
                                                                   
Jonathan Davies                Severn Trent      0121 722 4295     
                                                                   
Head of Investor Relations                                         
                                                                   
Peter Gavan                    Severn Trent      0121 722 4273     
                                                                   
Director of Corporate Affairs                                      
                                                                   
David Trenchard                Tulchan           0207 353 4200     
                                                                   
Peter Hewer                                                        
                                                                   

Footnotes:

1    The financial statements presented have been prepared in accordance with  
     IFRS, as endorsed by the EU, and interpretations issued by the            
     International Financial Reporting Interpretations Committee (IFRIC) or its
     predecessor body. The Group's IFRS accounting policies are set out on     
     pages 57 to 63 of its 2006 Annual Report.                                 
                                                                               
2    PBIT is profit before interest and tax and excluding exceptional items.   
                                                                               
3    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", "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.