Submission of business plan for period 2020-2025

RNS Number : 4931Z

Severn Trent PLC

03 September 2018

 

LEI: 213800RPBXRETY4A4C59                     

Submission of business plan for the period 2020-2025

Severn Trent Plc has today submitted Final Business Plans to Ofwat for its subsidiaries Severn Trent Water and Hafren Dyfrdwy Cyfyngedig for the regulatory period 2020-2025.

This marks a milestone in a process that has involved our broadest, most diverse and most detailed customer research undertaken to date, including the creation of a 15,000 strong online consumer panel, directly engaging with almost 32,000 customers and analysing 1.9 million customer interactions.

As a result, we have been able to submit plans that truly reflect what customers have told us they want. For Severn Trent Water Customers this includes a real bill reduction of 5%¹ -- the largest in two decades, and a commitment to triple the number of customers we help through our social tariff schemes. To support this bill reduction, we will use our innovation and commercial pipelines to deliver a 13% efficiency in spending, with total expenditure of £6.6 billion over the 5 years.

Our plan shows our continuing ambition to improve the service we provide our customers, with stretching performance commitments and a RORE range for ODIs of -3.0% to +2.6%. We will invest in our assets to protect water supplies for generations to come, contributing to double-digit growth² in our RCV over the 5-year period, financing the business responsibly with average gearing of 63.6%.

Additionally, we are proposing for a new community dividend of 1% of profits³ each year, to support communities in the Severn Trent region.

Hafren Dyfrdwy customers can expect average combined bills to continue to be the lowest in Wales, whilst we target our most ambitious improvements in the areas customers have told us matter most, helping twice as many people who struggle with their bills in the process. We will invest in our critical infrastructure and undertake our largest programme of environmental investment in 20 years, for the benefit of our Welsh communities and the environment for generations to come.

Ofwat will publish initial feedback of business plans in late January 2019.

Details of the plans and an investor summary can be found on the Severn Trent website;` https://www.severntrent.com/investors/company-information/strategy-and-plan/business-plan/

A webcast and conference call with Liv Garfield, Chief Executive, James Bowling, Chief Financial Officer and Tony Ballance, Director, Strategy and Regulation, will be held tomorrow, 4 September at 12.00 (UK time) with an opportunity for Q&A.

The following link will direct you to the webcast:

https://edge.media-server.com/m6/p/8m7yo8sj

To dial into the audio, the details are as follows:

·     UK and International dial in: [phone]

·     UK free phone dial in: 0800 279 7204

·     US free phone dial in: 888-204-4368

·     Conference code: 6687865

As a reminder we will be presenting the plan in more detail at our Capital Markets Day on 14 September.  If you wish to attend, please RSVP to [e-mail]

1.     5% reflects real bill reduction in CPIH prices.

2.     RCV growth forecast is in nominal prices

3.     Profit is defined as Profit for the year as reported within Severn Trent Water Limited's Annual Performance Report.

Enquiries
Investors & Analysts
Richard Eadie	Severn Trent Plc	[phone]
Head of Investor Relations
Rachel Martin	Severn Trent Plc	[phone]
Investor Relations Manager
Media
Press Office	Severn Trent Plc	[phone]
Jonathan Sibun	Tulchan	[phone]

Cautionary statement regarding forward-looking statements

This document contains statements that are, or may be deemed to be, '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', 'will', 'would', 'should', 'expects', 'believes', 'intends', 'plans', 'projects', 'potential', 'reasonably possible', 'targets', 'goal', 'estimates' or words with a similar meaning, and, in each case, their negative or other variations or comparable terminology. Any forward-looking statements in this document are based on Severn Trent's current expectations and, 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 may or may not occur in the future.

Forward-looking statements are not guarantees of future performance and no assurances can be given that the forward-looking statements in this document will be realised. There are a number of factors, many of which are beyond Severn Trent's control that could cause actual results, performance and developments to differ materially from those expressed or implied by these forward-looking statements. These factors include, but are not limited to: the Principal Risks disclosed in our latest Annual Report and Accounts (which have not been updated since the date of its publication); 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. No assurances can be given that the forward-looking statements in this document will be realised. This document speaks as at the date of publication. Save as required by applicable laws and regulations, Severn Trent does not intend to update any forward-looking statements and does not undertake any obligation to do so. Past performance of securities of Severn Trent Plc cannot be relied upon as a guide to the future performance of securities of Severn Trent Plc.

Nothing in this document should be regarded as a profits forecast.

This document is not an offer to sell, exchange or transfer any securities of Severn Trent Plc or any of its subsidiaries and is not soliciting an offer to purchase, exchange or transfer such securities in any jurisdiction. Securities may not be offered, sold or transferred in the United States absent registration or an applicable exemption from the registration requirements of the US Securities Act of 1933 (as amended).

 

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