Interim Results

Severn Trent PLC
28 November 2000


Interim Results for the six months to 30 September 2000

SEVERN TRENT MAKES GOOD PROGRESS WITH ENVIRONMENTAL SERVICES STRATEGY

Following the announcement of Severn Trent's interim results for the half year
ended 30 September 2000, David Arculus, Chairman, Severn Trent Plc, said:

'This has been a good first half performance by Severn Trent.  Severn Trent
Water has produced a good result, faced as it is with the challenges set by
OFWAT's tough review.  Biffa is growing strongly in the UK and, following the
acquisition of UK Waste, is well placed to benefit from future changes in the
waste market.  Services is integrating the businesses acquired over the course
of the last year and is now focused on delivering organic growth.

'Since Robert Walker became Group Chief Executive in August, Severn Trent is
actively embracing the growth agenda.  The Group is now in a strong position
to take advantage of the opportunities presented by the UK environmental
services market.'

Financial and operating highlights:

Group:
-  Turnover up 5.7% to £790.8 million (£748.3 million)
-  Profit before interest down £40 million to £186.0 million (£226.0 million),
   reflecting impact of substantial reduction in income arising from OFWAT price
   determination
-  Unchanged interim dividend of 17.0 pence per share

Severn Trent Water:
-  Turnover down 9.4% to £442.3 million (£488.1 million), reflecting impact of
   11.8% net reduction in average prices following the OFWAT review
-  Profit before interest down 19.8% to £168.1 million
-  Opex and Capex outperformance on track whilst maintaining high standards of
   customer service and quality compliance
-  Integrated model works for Severn Trent Water - leading contender for
   supply side contracts

Biffa:
-  Turnover up 5.8% to £153.1 million
-  Profit before interest up 19.2% in the UK, unchanged overall
-  UK Waste integration progressing well - on track to achieve £15 million per
   annum in synergies
-  Well positioned to benefit from implementation of Government's waste
   strategy

Severn Trent Services:
-  Rapid growth continued with turnover up 60% to £168.3 million
-  Profit before interest up 35.6%
-  Integration of brands underway
-  Focus on delivering organic growth


Enquiries:

Robert Walker           Severn Trent Plc   020 7404 5959 (on the day)
Group Chief Executive                      0121 722 4775

Alan Costin             Severn Trent Plc   020 7404 5959 (on the day)
Group Finance Director                     0121 722 4429

Simon Holberton         Brunswick Group    020 7396 5326
Helen Shepard


Chairman's Statement

Over the past six months we have made good progress towards our strategic goal
of transforming Severn Trent from a regulated UK water utility into an
environmental services business.  The most significant development has been
the acquisition of UK Waste, which was completed on 22 September 2000.  Biffa,
our waste management business, is now the UK market leader in integrated waste
management.  In the USA, Severn Trent Services has also achieved substantial
growth, building successfully on the acquisitions completed during the
preceding year.

Severn Trent Water is meeting the challenge presented by the substantial
reduction in income arising from the OFWAT price determination for the
five-year period commencing 1 April 2000.  Considerable cost efficiencies have
been achieved at the same time as maintaining the high standards of service
and environmental improvements to which the company is committed.

The three businesses together are well placed to deliver a wide range of
environmental solutions for a broad customer base.

Group results

Group turnover was £790.8 million, an increase of 5.7% over the first half of
last year.  Group profit before interest was £186.0 million, £40.0 million
lower than the result for the corresponding period last year which included
£3.1 million of exceptional costs to ensure that the Group's systems were Year
2000 compliant.

The fall in profit was primarily the result of the 11.8% net reduction in
average charges in Severn Trent Water, following the OFWAT review.

Interest costs of £73.2 million were £16.3 million higher.  Consequently,
profit before tax was £56.3 million lower than in the first half of last year
at £112.8 million.  The charge for taxation was £7.9 million, £7.3 million
less than in the corresponding period, with the result that profit after tax
was £104.9 million, a reduction of £49.0 million.  Basic earnings per share
for the half-year was 30.6 pence.

Net debt at 30 September 2000 was £2,332 million, an increase of £393 million
during the half year.  The increase included the cost of acquisitions which in
total accounted for gross cash outflow of £405 million, £375 million resulting
from the purchase of UK Waste.  Gearing increased to 89.2%, but interest cover
remained healthy with net interest charges covered 4.3 times by profit before
interest, tax, depreciation and amortisation.

The results do not include any trading from UK Waste.  However, the cost of
the acquisition and the estimated assets and liabilities acquired are included
in the consolidated balance sheet and cashflow statement.

Dividend

The Board has declared an unchanged interim dividend of 17.0 pence per share,
to be paid on 6 April 2001.

It remains the intention of the Board that for the period up to 31 March 2005,
barring unforeseen circumstances, dividends per share will as a minimum be
maintained at the same level as was paid for the year ended 31 March 2000.

Leadership in Environmental Services

Severn Trent continues to perform to exacting environmental standards within
its own operations.  Earlier this year, the Group was awarded first place in
the Business in the Environment's Index of Corporate Environmental Engagement;
for the second year running Severn Trent is a leading participant in the Dow
Jones Sustainability Index, and a number of important environmental awards
have been achieved.  In July, Professor Dan Esty, a leading US environmental
adviser was appointed to the Severn Trent Environmental Advisory Panel.

Biffaward is now in its third year of operation and is proving to be a success
under the management of The Royal Society for Nature Conservation.  More than
£19 million has gone towards funding 254 projects in just under 3 years.

A significant business opportunity is emerging to provide an integrated range
of environmental services to industrial and commercial customers.  This demand
is driven by governmental and regulatory pressure on companies to take
responsibility for the impact of their business activities on the environment,
as customers, suppliers and other stakeholders increasingly hold companies to
account for their environmental management.  An independent study carried out
by Severn Trent confirms the growing demand from business customers to assist
them in identifying solutions to their environmental problems.  This indicates
that the environmental services market in the UK is currently worth some £8
billion.  Waste services and recycling are the key to unlocking this
opportunity, representing more than half the total value.

The Severn Trent Group is uniquely positioned in the UK to provide business
customers with a wide range of environmental services.  Severn Trent Water is
one of the UK's leading water supply and waste water companies; Biffa is now
the leading UK integrated waste services company; and Severn Trent Services in
the UK is the largest provider of laboratory based environmental testing and a
major supplier of industrial water treatment and purification equipment and
services.

Water

Severn Trent Water's profit before interest and tax for the half-year was
£168.1 million (1999/00: £209.6 million after £3.1 million exceptional Year
2000 compliance costs).  The £41.5 million reduction in profit reflected the
impact of lower charges to customers following the OFWAT determination for the
five-year period beginning 1 April 2000.

Turnover at Severn Trent Water was £442.3 million (£488.1 million), a
reduction of 9.4%.  The reduction in charges, net of discontinued customer
rebates, amounted to 11.8%, but was partially offset by allowed RPI of 1.4%
and tariff changes.  £1.5 million turnover was generated by new business
ventures.  The impact of lower consumption by industrial and commercial
customers was offset by new customers moving into the Severn Trent region. 
The decision by some domestic customers to switch to the metered tariff
reduced income by £1.6 million.

The company is well prepared for the introduction of competition in the water
industry.  Our network access code was published in June, we have a set of
competitive tariffs, and we are developing a new billing system for large
customers which will have e-commerce functionality.  Severn Trent Water
recently secured its second national account, with Center Parcs, and through a
joint initiative with Electralink has been instrumental in creating a
framework for the electronic transmission of customer data.

The company was pleased that its recent successful court action against Dwr
Cymru, Hyder, WPD and United Utilities has opened the way for competitive
tendering when water companies in England and Wales decide to outsource their
operations.

Direct operating costs in Severn Trent Water were £175.8 million, a reduction
of 0.2% despite the impact of year on year inflation of 2.8%.  Cost
efficiencies were achieved in the half year amounting to £10.6 million,
equivalent to 6.0%, which were partly offset by the increased costs associated
with running new plant commissioned at the end of the previous regulatory
period.

The programme for reducing costs in Severn Trent Water is progressing well. 
At the same time the business continues to maintain high standards of service
to customers, whilst achieving record levels of compliance with drinking water
and other environmental standards.  On a like for like basis, headcount has
been reduced by 650 since November 1999, when the OFWAT price determination
was announced, and we have also made savings across most other areas of
expenditure, particularly power, chemicals and sewerage agencies.

Depreciation charges for the half-year amounted to £100.7 million.

Capital expenditure in Severn Trent Water amounted to £147.9 million and is
expected to be around £335 million for the full year.  This investment
continues to be essential to the achievement of the high quality water and
sewerage services Severn Trent Water delivers to its customers: overall
compliance with water quality standards was 99.9% for the half-year, and
sanitary standards for wastewater were again maintained at almost 100%.

Earlier this month the company's operations were severely disrupted by
flooding in the Midlands; in both the Severn and the Trent catchments floods
were experienced on a similar scale to those in 1947.  However, there were few
disruptions to customer service despite the fact that for prolonged periods
some operational locations (several water treatment plants, over 50 sewage
treatment works and over 70 sewerage pumping stations) were unable to operate.
 During this period, Severn Trent Water's employees performed exceptionally
well to counter the weather problems.

November's storms only served to reinforce our concerns about climate change. 
We were very disappointed by OFWAT's response to our resource plans for the
period 2000-2005; in a similar way the lack of funding made available for
upgrading the sewerage infrastructure was of concern.  Our pioneering work
with the Meteorological Office's Hadley Centre for Climate Change Forecasting
demonstrates that wetter winters and drier summers will become the
characteristic weather patterns in the first half of the 21st century;
regulators and governments will need to address these impacts more proactively
in the future than they have done to date.

Waste

Biffa Waste Services again performed very well in the UK, where higher profits
offset the trading problems experienced in Belgium.  Biffa's overall profit
before interest and tax was £15.8 million, unchanged from the first half of
last year.

In the UK, turnover of £132.9 million was up 8.8% (up 6.4% excluding landfill
tax). Profit before interest and tax increased by 19.2% to £14.3 million.  The
results do not include the trading of UK Waste, which was acquired eight days
before the half-year end. 

This excellent result reflected another very strong performance by the
collection division, and a reversal of the decline in profits from the
landfill division which we experienced last year.  Special waste division also
achieved a good increase in profits.

Industrial and commercial collection volumes were up 5%, which, combined with
good cost controls, were the main factors behind a 12% increase in profit from
this division.

Landfill volumes were up 6% and average unit revenues stabilised with a modest
1% increase.  Overall profit from the landfill division was up 23% on the
corresponding period, aided by the cost reduction measures taken last year.

In Belgium, profits fell by £2.3 million to £1.5 million as a result of lower
landfill volumes, continuing the trend experienced during the second half of
last year.   Market conditions are no longer as buoyant as they have been in
recent years, as waste is being transported out of Belgium for incineration in
Germany where excess capacity is available at low prices.  Despite this, the
excellent location of the Cour au Bois landfill still ensures adequate returns
on capital even at these reduced volumes.

Profits from the Collection division in Belgium were up 4% in local currency
on revenues up 15%, through new municipal contracts and a tuckunder
acquisition expanding our geographic coverage in the south of the country.

The integration of UK Waste is now underway.  Following the required 90 day
consultation process with employee unions and staff, the merging of depots has
now commenced.  In total 14 depots out of the combined collection network will
be closed as operations are merged.  The company has already been integrated
into Biffa's divisional structure and the two management Boards have been
combined.    Successful implementation of Biffa's IT systems at the UK Waste
operations is a critical element of the process, and thorough testing has
confirmed Biffa's readiness for this additional workload.  The merger is
expected to realise synergies of at least £15 million per annum when
integration is fully completed, which is anticipated to take 18 months.

The Board was very pleased to welcome Robin Tweedale and Malcolm Saville,
formerly managing director and personnel director of UK Waste, to the board of
Biffa Waste Services.  Their appointments further strengthen Biffa's excellent
management team.

The acquisition of UK Waste has reinforced Biffa's market leadership position,
particularly in commercial and industrial waste collection.  It has also
considerably expanded Biffa's recycling activities which now include the
management under contract of SCA Recycling UK's fleet and their recycling
activities at Bury, enhancing the already strong relationship which exists
between the two companies.

These developments have positioned Biffa extremely well to meet the challenges
to the waste industry which the implementation of the government's waste
strategy will pose, and the growth opportunities that this will bring.

Services

The rapid growth in the scale of Severn Trent Services was maintained during
the half-year.  Turnover increased by 60% to £168.3 million and profit before
interest was up 35.6% at £11.8 million.  Growth in the USA, which is the focus
of the business's activities, was particularly strong with profit before
interest up 64%.

Turnover in analytical services in the USA increased by 149% to £64.5 million.
 In the UK, which benefited from the acquisition of Hyder Laboratories in
April 2000, turnover increased by 86% to £9.5 million.  Margin on sales
continued to be strong and in line with our expectations.  Whilst much of the
growth was driven by the acquisitions made during the second half of
1999/2000, the business in the USA has also delivered organic growth.  As the
clear industry leader in laboratory based testing in both the USA and the UK,
we are now seeking to develop the range of services offered to our customers,
who include many large national accounts.

Turnover in operating services in the USA increased by 68% to £46.3 million
and margin on sales improved.  In Europe, turnover increased by 57% to £11.3
million, with particularly encouraging growth in Italy.

Turnover in the purification division was up 16% in the USA, although margin
on sales was below the target level.  Results in the UK were adversely
impacted by lower demand from water companies, including Severn Trent Water,
as a result of reduced expenditure in the first year of the new regulatory
five-year period.  As a consequence, the UK business produced a small loss.

Considerable progress has been made towards integrating the range of products
and services within Severn Trent Services.  The divisional management teams
now work from a single headquarters at Fort Washington, Pennsylvania, and the
support functions are aligned on a business wide basis.  This has delivered
significant cost savings, and most importantly is helping to establish the
Severn Trent Services brand.

Whilst the emphasis is now on the achievement of organic growth, cost control
and margin improvement, we will continue to make acquisitions to fill gaps in
Severn Trent Services' product range.  During the half-year, Services acquired
three businesses in the USA plus Hyder Laboratories in the UK at a total cost
of £24.6 million.
 
Systems

Turnover in Severn Trent Systems was £39.4 million for the half-year, 9% lower
than in the corresponding period. 

When we announced our results for the year ended 31 March 2000, we indicated
that the Board would undertake a thorough review of the strategic alternatives
for Severn Trent Systems.  Following that review, we have determined how best
to take the business forward.

The IT Services business unit is highly competitive, profitable and contains
technology skills that are essential to maintaining industry leading
capabilities, particularly in asset management.  These will be further
exploited across the Group companies and developed to generate external
revenues.  During the half-year, software was delivered to Severn Trent Water
to support the establishment of two new network management centres, a records
management office using digital mapping and GIS technology, and a two hundred
seat call centre.

Our network modelling and work management software products are market leaders
and continue to be profitable. However they need to be more aggressively
marketed in order to achieve their growth potential, and we continue to look
for business alliances and partnerships to achieve this.

During the half-year we completed two more implementations of our CIS-OV
customer information and billing system. However this system has required
further investment to complete its full functionality, and this has caused
this business unit to continue to be loss making. We have signed three further
contracts, and the revenues from these should lead to some improvement in the
second half-year result.

Overall the business made a loss before interest in the half year of £2.7
million (1999/00: loss £1.0 million).

Property, Engineering consultancy and Insurance

Severn Trent Property, together with Charles Haswell & Partners and Derwent
Insurance, produced profit before interest for the half-year of £0.4 million
(1999/00: £0.5 million).

At its site in Daventry, Northants, Severn Trent Property completed a 260,000
sq ft warehouse for Ingram Micro, and W H Malcolm Limited took possession of
their new purpose built 256,000 sq ft rail linked warehouse.  Work on a second
rail linked warehouse for Tibbett & Britten Plc has just commenced.  At Thorpe
Park, the prime out of town office park for Leeds, construction is well
advanced on a 36,000 sq ft office building for Time Retail Finance Limited,
with strong enquiries in respect of further buildings.

Charles Haswell & Partners continued to grow its engineering consultancy
activities with clients outside the Severn Trent group, but its results were
adversely impacted by a reduction in work undertaken for Severn Trent Water as
a consequence of the timing of investment for the new regulatory period.

Derwent Insurance continued to provide certain insurance services for Severn
Trent group companies.

Management

Robert Walker, previously Deputy Chief Executive, succeeded Vic Cocker as
Group Chief Executive following the Company's Annual General Meeting on 1
August 2000.

We were pleased to announce in September that Dr John McAdam had joined the
Board as a non-executive director.  John is a main board member of ICI Plc,
where he is currently responsible for world-wide decorative and industrial
coatings operations and corporate science and technology.  He also oversees
ICI's activities in Asia.

Outlook

The water industry in the UK is in a period of substantial change, triggered
by the challenge of delivering proper returns to shareholders in the face of a
harsh regulatory environment.  Restructuring of regulated water businesses may
provide important growth opportunities for the most efficient companies.  It
may also provide more cost efficient financing.  Severn Trent will take
advantage of these changes if they are in the best long-term interests of
shareholders and customers, but our strategy will continue to be based upon
profitable growth of our waste and services businesses and outperformance by
our regulated water business against the targets built into the OFWAT price
determination.

We are well placed to achieve those objectives. Biffa, through its organic
growth and now with the acquisition of UK Waste, has a leading position in one
of the most attractive waste markets in Europe.  It has a comprehensive range
of facilities and a competitive cost structure.  There are opportunities to
expand into other selected European markets and these will be pursued provided
they create shareholder value.  Severn Trent Services is focussed on organic
growth and improving profitability; Severn Trent Water has already implemented
many of the cost efficiencies programmed for the next three years; and we have
identified a market for an integrated environmental services product which we
are uniquely equipped to supply.

David Arculus
Chairman, Severn Trent Plc


Group profit and loss account
Six months ended 30 September 2000

                                        Unaudited    Unaudited       Audited
                                      6 months to  6 months to    Year ended
                                       30 Sept 00   30 Sept 99   31 March 00
                                Notes          £m           £m            £m

Turnover: group and share of
   joint ventures                           792.9        750.7       1,580.2
Less: share of joint ventures'
   turnover                                  (2.1)        (2.4)        (13.6)
-----------------------------------------------------------------------------

Continuing operations                       783.4        748.3       1,566.6
Acquisitions                                  7.4            -             -
-----------------------------------------------------------------------------

Turnover                          2         790.8        748.3       1,566.6
-----------------------------------------------------------------------------

Operating costs before
  exceptional costs                        (609.0)      (523.4)     (1,115.8)
Exceptional costs                 3             -         (3.1)        (64.7)
-----------------------------------------------------------------------------

Total operating costs                      (609.0)      (526.5)     (1,180.5)
-----------------------------------------------------------------------------

Operating profit
Continuing operations                       182.1        221.8         386.1
Acquisitions                                 (0.3)           -             -
-----------------------------------------------------------------------------
                                            181.8        221.8         386.1
-----------------------------------------------------------------------------
Joint ventures and associates
Continuing operations                         4.2          4.2           8.6
-----------------------------------------------------------------------------
Profit before interest            2         186.0        226.0         394.7

Net interest payable                        (73.2)       (56.9)       (120.7)
-----------------------------------------------------------------------------
Profit on ordinary activities
  before taxation                           112.8        169.1         274.0

Taxation on profit on
  ordinary activities             4          (7.9)       (15.2)        (22.1)
-----------------------------------------------------------------------------
Profit on ordinary activities
  after taxation                            104.9        153.9         251.9

Dividends (including non-equity
  dividends)                      6         (58.4)       (58.2)       (154.0)
-----------------------------------------------------------------------------
Retained profit                              46.5         95.7          97.9
-----------------------------------------------------------------------------
Earnings per share (pence)
Basic                             5          30.6         45.1          73.8
Diluted                           5          30.5         44.8          73.5
Basic before exceptional costs    5          30.6         46.0          92.8
Diluted before exceptional costs  5          30.5         45.7          92.3


Group balance sheet
At 30 September 2000

                                        Unaudited    Unaudited       Audited
                                       30 Sept 00   30 Sept 99   31 March 00
                                               £m           £m            £m
Fixed assets
Intangible assets
  Goodwill                                  435.6        113.3         138.0
Tangible assets                           4,798.3      4,456.4       4,630.9
  Investments in joint ventures
    Share of gross assets                     5.1          7.6           7.3
    Share of gross liabilities               (4.5)        (6.7)         (6.9)
    Loans                                     4.6          4.5           4.5
-----------------------------------------------------------------------------
                                              5.2          5.4           4.9
  Investment in associates                   15.8         17.0          16.3
  Other investments                           3.4          4.2           4.5
-----------------------------------------------------------------------------
Total investments                            24.4         26.6          25.7
-----------------------------------------------------------------------------
                                          5,258.3      4,596.3       4,794.6
Current assets
Stocks                                       81.9         86.2          77.3
Debtors                                     420.4        326.7         353.8
Short-term deposits                          25.8         30.7          35.8
Cash at bank and in hand                     16.2         17.7           8.4
-----------------------------------------------------------------------------
                                            544.3        461.3         475.3
Creditors: amounts falling due
  within one year                          (990.4)      (887.0)     (1,089.2)
-----------------------------------------------------------------------------
Net current liabilities                    (446.1)      (425.7)       (613.9)
-----------------------------------------------------------------------------
Total assets less current liabilities     4,812.2      4,170.6       4,180.7
Creditors: amounts falling due after
  more than one year                     (2,090.9)    (1,581.4)     (1,537.7)
Provisions for liabilities and charges     (108.2)       (48.6)        (96.0)
-----------------------------------------------------------------------------
Net assets                                2,613.1      2,540.6       2,547.0
-----------------------------------------------------------------------------
Capital and reserves
Called up share capital                     232.6        231.6         231.7
Share premium account                        19.1         11.7          12.2
Capital redemption reserve                  147.0        147.0         147.0
Profit and loss account                   2,214.1      2,150.0       2,155.8
-----------------------------------------------------------------------------
Total shareholders' funds                 2,612.8      2,540.3       2,546.7

  Equity shareholders' funds              2,603.7      2,531.2       2,537.6
  Non-equity shareholders' funds              9.1          9.1           9.1
Minority shareholders' interest (equity)      0.3          0.3           0.3
-----------------------------------------------------------------------------
                                          2,613.1      2,540.6       2,547.0
-----------------------------------------------------------------------------


Group cash flow statement
Six months ended 30 September 2000

                                        Unaudited    Unaudited       Audited
                                       30 Sept 00   30 Sept 99   31 March 00
                                Notes     £m   £m      £m   £m       £m   £m

Net cash inflow from
  operating activities            8         303.7        344.7         671.5

Dividends received from
  associates and joint ventures               1.3          1.4           1.5

Returns on investments and
  servicing of finance                      (50.0)       (37.4)        (94.5)

Taxation                                     (1.3)        (1.3)        (49.3)

Capital expenditure and
  financial investment                     (196.0)      (300.2)       (575.5)

Acquisitions                               (404.6)       (82.6)       (145.1)

Equity dividends paid                       (57.9)      (156.1)       (247.1)
-----------------------------------------------------------------------------
Net cash outflow before use of
  liquid resources and financing           (404.8)      (231.5)       (438.5)
Management of liquid resources               10.0         (8.1)        (13.8)
Financing
Increase in debt                       362.6        230.0         428.0
Issue of shares                          5.8          3.3           3.6
                                       -----        -----         -----
                                            368.4        233.3         431.6
-----------------------------------------------------------------------------
Decrease in cash                            (26.4)        (6.3)        (20.7)
-----------------------------------------------------------------------------


Reconciliation of net cash flow
  to movement in net debt

                                        Unaudited    Unaudited       Audited
                                       30 Sept 00   30 Sept 99   31 March 00
                                Notes          £m           £m            £m

Decrease in cash (as above)                 (26.4)        (6.3)        (20.7)
Cash flow from movement in net
  debt and financing                       (362.6)      (230.0)       (428.0)
Cash flow from movement in
  liquid resources                          (10.0)          8.1         13.8
-----------------------------------------------------------------------------
Change in net debt resulting
  from cash flows                          (399.0)      (228.2)       (434.9)
Net cash/(debt) assumed with acquisitions    13.8        (17.9)        (14.9)
Inception of finance leases                  (7.3)        (6.8)        (11.3)
Rolled up interest on debt                      -            -          (0.2)
Currency translation differences             (0.2)        (0.2)          0.4
-----------------------------------------------------------------------------
Increase in net debt                       (392.7)      (253.1)       (460.9)
Opening net debt                         (1,939.4)    (1,478.5)     (1,478.5)
-----------------------------------------------------------------------------
Closing net debt                  7      (2,332.1)    (1,731.6)     (1,939.4)
-----------------------------------------------------------------------------


Reconciliation of movements in shareholders' funds
Six months ended 30 September 2000

                                        Unaudited    Unaudited       Audited
                                       30 Sept 00   30 Sept 99   31 March 00
                                               £m           £m            £m

Profit for the period                       104.9        153.9         251.9
Dividends (including non-equity)            (58.4)       (58.2)       (154.0)
-----------------------------------------------------------------------------
                                             46.5         95.7          97.9

Other recognised gains and losses
  relating to the period                     13.8         (4.6)         (0.7)
Shares issued                                 5.8          3.3           3.6
-----------------------------------------------------------------------------
Net addition to shareholders' funds          66.1         94.4         100.8

Opening shareholders' funds               2,546.7      2,445.9       2,445.9
-----------------------------------------------------------------------------
Closing shareholders' funds               2,612.8      2,540.3       2,546.7
-----------------------------------------------------------------------------


Notes

1 Basis of preparation

The unaudited interim results for the six months ended 30 September 2000 have
been prepared on the basis of accounting policies consistent with those
adopted for the year ended 31 March 2000,as set out in the financial
statements of the group.

The comparative figures for the year ended 31 March 2000 and other financial
information contained herein do not constitute statutory accounts within the
meaning of Section 240 of the Companies Act 1985.  Statutory accounts for the
year ended 31 March 2000, incorporating an unqualified auditors' report, have
been filed with the Registrar of Companies.


2 Segmental analysis of turnover and profit before interest by geographical
  origin and type of business
                                                     Other -
                                                  principally
                                United Kingdom   USA & Europe          Group
                                ---------------------------------------------

Six months ended 30 September      2000   1999    2000   1999    2000   1999
                                     £m     £m      £m     £m      £m     £m
-----------------------------------------------------------------------------

Group turnover

Water and sewerage                442.3  488.1       -      -   442.3  488.1
Waste management                  132.9  122.2    20.2   22.5   153.1  144.7
Services                           24.5   29.0   143.8   76.2   168.3  105.2
Systems                            30.7   36.6     8.7    6.7    39.4   43.3
Property, Engineering
  consultancy and Insurance        27.9   26.7       -    0.2    27.9   26.9
Inter segment trading             (40.0) (59.7)   (0.2)  (0.2)  (40.2) (59.9)
-----------------------------------------------------------------------------
                                  618.3  642.9   172.5  105.4   790.8  748.3
-----------------------------------------------------------------------------


Group profit before interest
-----------------------------------------------------------------------------

Water and sewerage                168.1  209.6       -      -   168.1  209.6
Waste management                   14.3   12.0     1.5    3.8    15.8   15.8
Services                           (1.0)   0.2    12.8    8.5    11.8    8.7
Systems                            (1.7)  (1.3)   (1.0)   0.3    (2.7)  (1.0)
Property, Engineering
  consultancy and Insurance         0.4    0.5       -      -     0.4    0.5
Unrealised profit on
  inter segment trading            (1.6)  (1.6)      -      -    (1.6)  (1.6)
-----------------------------------------------------------------------------
                                  178.5  219.4    13.3   12.6   191.8  232.0
-------------------------------------------------------------
Corporate overheads                                              (5.8)  (6.0)
                                                             ----------------
                                                                186.0  226.0
                                                             ----------------

The segmental analysis has been amended to be consistent with the group's
financial statements for the year ended 31 March 2000 and excludes from
Services the results of Severn Trent Systems, which are now shown separately.
Comparative figures have been amended accordingly.

Water and sewerage turnover in the six months ended 30 September 1999 was net
of customer rebates of £9.0 million.  There were no customer rebates in the
six months ended 30 September 2000.

UK Waste was acquired on 22 September 2000.  Trading results of UK Waste for
the eight days to 30 September 2000 have not been included in the interim
results.  The cost of the acquisition and the estimated assets and liabilities
acquired are however included in the group balance sheet and cash flow
statement.

The segmental analysis includes the following amounts in respect of businesses
acquired during the six months to 30 September 2000 other than UK Waste:

                         Turnover                 Profit before interest
                  --------------------------    ---------------------------
                    United   USA and              United   USA and
                   Kingdom    Europe   Total     Kingdom    Europe   Total
                        £m        £m      £m          £m        £m      £m
---------------------------------------------------------------------------
Waste management         -       0.6     0.6           -        0.1    0.1
Services               4.7       2.1     6.8        (0.7)       0.3   (0.4)
---------------------------------------------------------------------------
                       4.7       2.7     7.4        (0.7)       0.4   (0.3)
---------------------------------------------------------------------------


3 Exceptional costs

Exceptional Year 2000 costs of £3.1 million in the 6 months to 30 September
1999, and £8.6 million in the year ended 31 March 2000, related to costs of
ensuring that all group computer and operating systems were Millennium
compliant.

Exceptional restructuring costs of £56.1 million in the full year to 31 March
2000 related to the costs of restructuring Severn Trent Water following the
AMP3 determination, and a restructuring of Severn Trent Services.

There have been no exceptional costs in the six months ended 30 September
2000.


4 Taxation

                                       Six months to        Six months to
                                   30 September 2000    30 September 1999
                                                  £m                   £m

UK corporation tax at 30%                        4.9                 11.9
Double taxation relief                          (0.4)                (0.4)
Overseas taxation                                2.9                  3.2
Share of taxation charges:
    - joint ventures and associates              0.5                  0.5
                                              ------               ------
                                                 7.9                 15.2
                                              ------               ------


5 Earnings per share

Basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders by the weighted average number of ordinary shares in
issue during the period, excluding those held in the Severn Trent Employee
Share Ownership Trust which are treated as cancelled.

For diluted earnings per share, the weighted average number of ordinary shares
in issue is adjusted to assume conversion of all potentially dilutive ordinary
shares.  These represent share options granted to employees where the exercise
price is less than the average market price of the company's shares during the
period.

Supplementary earnings per share figures are presented.  These exclude the
effects of exceptional Year 2000 costs in 1999.  The Directors consider that
the supplementary figures provide a useful additional indication of
performance.

                                      Six months to 30 September 2000
                                   -------------------------------------
                                                 Weighted
                                                  average
                                                   number     Per share
                                   Earnings     of shares        amount
                                         £m             m         pence
------------------------------------------------------------------------
Basic earnings per share              104.7         341.9          30.6
Effect of dilutive options                -           1.6          (0.1)
------------------------------------------------------------------------
Diluted earnings per share            104.7         343.5          30.5
------------------------------------------------------------------------

Supplementary earnings per share
------------------------------------------------------------------------
Basic earnings per share              104.7         341.9          30.6

Effect of exceptional Year 
  2000 costs                              -             -             -
------------------------------------------------------------------------
Basic earnings per share before 
  Year 2000 costs                     104.7         341.9          30.6
------------------------------------------------------------------------
Diluted earnings per share            104.7         343.5          30.5

Effect of exceptional Year 
  2000 costs                              -             -             -
------------------------------------------------------------------------
Diluted earnings per share 
  before Year 2000 costs              104.7         343.5          30.5
------------------------------------------------------------------------


                                      Six months to 30 September 1999
                                   -------------------------------------
                                                 Weighted
                                                  average
                                                   number     Per share
                                   Earnings     of shares        amount
                                         £m             m         pence
------------------------------------------------------------------------
Basic earnings per share              153.7         340.7          45.1
Effect of dilutive options                -           1.9          (0.3)
------------------------------------------------------------------------
Diluted earnings per share            153.7         342.6          44.8
------------------------------------------------------------------------

Supplementary earnings per share
------------------------------------------------------------------------
Basic earnings per share              153.7         340.7          45.1
Effect of exceptional Year 
  2000 costs                            3.1             -           0.9
------------------------------------------------------------------------
Basic earnings per share before 
  Year 2000 costs                     156.8         340.7          46.0
------------------------------------------------------------------------
Diluted earnings per share            153.7         342.6          44.8

Effect of exceptional Year 
  2000 costs                            3.1             -           0.9
------------------------------------------------------------------------
Diluted earnings per share 
  before Year 2000 costs              156.8         342.6          45.7
------------------------------------------------------------------------


6 Interim dividend

An interim dividend of 17.0p per ordinary share will be paid on 6 April 2001
to shareholders on the register at 23 February 2001.  The shares will be
traded 'ex-dividend' with effect from 21 February 2001.


The cost of the interim dividend amounting to £58.2 million (1999: £58.0
million) was fully covered by dividends received by Severn Trent Plc from
subsidiary companies, which comprised £67.8 million from Severn Trent Water
(1999: £72.5 million) and £6.6 million from other group companies (1999: £6.0
million).  Non-equity dividends of £0.2 million were also paid in the six
months to 30 September 2000 (1999: £0.2 million).


7 Analysis of net debt

                           30 Sept 2000     30 Sept 1999      31 March 2000
                                     £m               £m                 £m

Cash at bank and in hand           16.2             17.7                8.4
Short-term deposits                25.8             30.7               35.8
Overdrafts                        (41.0)           (18.8)             (21.0)
Debt due within one year         (308.5)          (246.6)            (486.7)
Debt due after one year        (1,566.9)        (1,236.7)          (1,188.7)
Finance leases due within
  one year                         (1.1)            (1.3)              (0.9)
Finance leases due after
  one year                       (456.6)          (276.6)            (286.3)
                               --------         --------           --------
Net debt                       (2,332.1)        (1,731.6)          (1,939.4)
                               --------         --------           --------


8 Reconciliation of profit before interest to operating cash flow

                                           Six months to      Six months to
                                       30 September 2000  30 September 1999
                                                      £m                 £m

Profit before interest                             186.0              226.0
Share of results of joint ventures
  and associates                                    (4.2)              (4.2)
Depreciation charge                                125.9              125.0
Amortisation of goodwill                             4.5                2.5
Profit on sale of tangible fixed
  assets                                            (1.4)              (2.3)
Deferred income received                             3.0                0.3
Deferred income written back                        (1.5)              (1.4)
Provisions for liabilities and charges               7.9                7.0
Utilisation of provisions for liabilities 
  and charges                                      (29.9)              (7.4)
Movement in working capital                         13.4               (0.8)
                                                --------            -------
Net cash inflow from operating
  activities                                       303.7              344.7
                                                --------            -------


9 Interim statement

The interim report and accounts were approved by the board of directors on 27
November 2000.

Further copies of this interim statement may be obtained from the Company
Secretary, Severn Trent Plc, 2297 Coventry Road, Birmingham B26 3PU.