Business
Severn Trent Plc Interim Management Statement
Severn Trent Plc Interim Management Statement.
About this update from Severn Trent Plc
[{"type":"text","content":"\n \nRNS Number : 4742J Severn Trent PLC 17 July 2013 \n \n\n17 July 2013 \n \nSevern Trent Plc Interim Management Statement\nfor the period 1 April to 16 July 2013\n \n \nThe Board of Severn Trent Plc confirms that trading across the group has been in line with its expectations and prior guidance. \n \nRegulated business\nCustomer prices in Severn Trent Water increased by 2.0% from 1 April 2013, reflecting November RPI of 3.0% and a k-factor of minus 1.0%. Consumption across our measured income base has declined year on year in the period, in line with our expectations.\n \nOur forecasted bad debt level is maintained at around 2.2% of turnover for the full year, and we continue to monitor developments such as unemployment levels and changes to the UK benefits system closely.\n \nOperating expenditure continues to be in line with the Board's expectations for the year and, on a like for like basis, in line with the level of the Final Determination. Operating costs are expected to rise year on year due to the impact of inflation and increases in quasi taxes, partially offset by efficiency improvements. \n \nExpectations for net capital expenditure (UK GAAP after deducting grants and contributions) remain in the range £600 million to £620 million, including an estimated £15 million related to private drains and sewers. The level of net infrastructure renewals expenditure included in this range is anticipated to be £135 million to £145 million.\n \nNon-regulated business\nIn Severn Trent Services we expect to see the benefits of our previous investments in growth areas. Growth will however be second half weighted as indicated by timing of deliveries from the Water Purification order book.\n \nGroup\nThe group interest charge is expected to be higher year on year due to higher net debt and with the adoption of revisions to IAS19 increasing the pension accounting interest charge. The year on year impact of this revision to IAS 19 is estimated at £13m.\n \nThe effective current tax rate for the group for 2013/14 is expected to remain between 23% and 25%.\n \nUnder our dividend policy of RPI+3% growth the dividend for 2013/14 is set to be 80.40 pence, representing growth of 6% year on year.\n \nOther\nIn early May Severn Trent Plc received an appro...