Severn Trent Plc · LSE:SVT
Severn Trent — Debt Investor Presentation (June 2021)
20 slides from Severn Trent's debt investor presentation, June 2021
Slide 1: Debt Investor Presentation June 2021
Debt Investor Presentation June 2021
Slide 2: Presenting and Treasury Team
PRESENTING AND TREASURY TEAM James Adam Nick Corker Bowling Stephens Assistant Chief Group Treasurer Financial Treasurer Officer James is a chartered accountant, having started Adam joined Severn Trent in April 2015. Nick is Assistant Treasurer of Severn Trent his career with Touche Ross. He brings
Slide 3: Agenda
AGENDA • FY21 Review • Green Recovery • Regulatory backdrop • Financials • ESG
Slide 4: FY 2020/21 Summary
FY 2020/21 SUMMARY Financial Performance Credit Performance Sector-leading Strong Adjusted Group net ODI liquidity PBIT of £473 Pension deficit performance, new £1bn million in line reduction plan on resulting in 5+1+1 with track - £368m £79m reward sustainable RCF expectations across all areas agre
Slide 5: Record Year in Water
RECORD YEAR IN WATER Major advances in Water performance Ensuring our water is of Step change in CRI scores and improving water quality the highest quality complaints by more than 60% and 10% respectively Targeting those measures customers care about most Focusing on customer with reductions in pers
Slide 6: Leaders in Waste
LEADERS IN WASTE Integrated approach delivers targeted benefits Focus on hotspot areas has decreased blockages by 30% Targeted approach Installing up to 40,000 sensors by 2025 in our network giving us better data and insight Investing in technology Beating our pollutions target by 20% through target
Slide 7: Environment-Led Approach
ENVIRONMENT-LED APPROACH Outperformance underpinned by exciting future partnerships Full AMP biodiversity Delivering AMP target with ambitions to improve 5,000ha by delivered in year 1 2027, enhancing the environment Catchment Educating and creating partnerships with over 7,000 management farmers, i
Slide 8: Customers First
CUSTOMERS FIRST Supporting our customers through a difficult year Supported more than 150,000 customers and Doubled number of launched COVID-specific Back on Track scheme customers supported Creating an intelligent customer system so we’re available whenever our customers need us Using digital initi
Slide 9: Green Recovery - Overview
GREEN RECOVERY - OVERVIEW Objective: To build back greener from the pandemic, delivering lasting environmental improvements for current and future generations, while meeting the economic and social challenges England faces. July 2020 – English January 2021 – Five May 2021 – Ofwat STW awarded £565m w
Slide 10: Green Recovery – Use of Proceeds
GREEN RECOVERY – USE OF PROCEEDS £565m Leading the sector in supporting the UK’s green economic recovery and environmental sustainability Trialling innovative nature-based flood solutions for Mansfield Increasing water supplies by enough to supply a city the size of Derby Creating bathing quality st
Slide 11: Regulatory Backdrop
REGULATORY BACKDROP Well established, transparent predictable regulatory regime Fast tracked AMP7 Plan provides stable cashflows Strong operational performance provides opportunities in incentive based regime £565m Green Recovery proposals approved CMA decision provides positive backdrop for AMP8 ne
Slide 12: Regulated Water and Waste Water PBIT
REGULATED WATER AND WASTE WATER PBIT COVID impacts but adjusted PBIT remains in line with expectations 28.9 540.4 (33.0) Increase in power and £m chemicals costs, as expected 511.5 (14.2) (17.1) (12.2) (18.7) 16.1 (11.2) 452.1 2.0 Investing for customer ODI performance Includes £6m for new OFWAT inn
Slide 13: Financing Overview
FINANCING OVERVIEW Net debt and gearing Recent Financing Activity 2021 2020 2021 2020 ✓ £250m Equity Placement ✓ £1 billion Sustainable 5+1+1 RCF ST Plc 6,444 6,232 67.5% 64.9% ✓ £100m 35 year CPIH bond issue STW 6,150 6,187 64.5% 64.4% ✓ £300m 20 year 2% Sustainable Bond ✓ £200m Sustainable USPP Cr
Slide 14: Financing Strategy
FINANCING STRATEGY Maintaining strong liquidity and diversified sources of funding to support £3bn funding requirement Liquidity Prudent 18 month liquidity policy, underpinned by £1bn 5+1+1 Sustainable RCF – Liquidity to early 2023 Funding risk Diversified sources of funding (Bank loans, bonds, USPP
Slide 15: Sustainability Runs Through Our Business
Green commitments in AMP7 SUSTAINABILITY RUNS Biodiversity Improving 5,000ha of biodiversity THROUGH OUR BUSINESS Planting 1.3m trees Triple carbon pledge 100% Renewable energy by Green communities Reducing leakage £0.6m of new natural capital Improving the environment Catchment management working 2
Slide 16: External Benchmarks
EXTERNAL BENCHMARKS Severn Trent has been recognised across multiple indices for our commitments to sustainability FTSE4Good Green Economy Mark MSCI We were awarded in 2020, We have been a constituent of In December 2020, MSCI rated which recognises companies the FTSE4Good index since us A (Scale AA
Slide 17: Sustainable Finance
SUSTAINABLE FINANCE Connecting our financing with the delivery of our bold commitments to the environment and wider society Sustainable Finance Reporting • In November 2019 we published our Sustainable Finance Framework • The Framework was reviewed by DNV-GL who issued a Second Party Opinion • The F
Slide 18: Summary
SUMMARY Creating foundations for a successful future, with Green Recovery driving increased growth Resilient financials delivering performance in line with expectations Strong operational performance and best-ever customer ODIs of £79m Helping our region bounce back and creating 2,500 jobs through G
Slide 19: Q&A
Q&A
Slide 20: Disclaimers
DISCLAIMERS Cautionary statement regarding forward-looking statements This document contains statements that are, or may be deemed to be, These factors include but are not limited to: the Principal Risks disclosed in our ‘forward-looking statements’ with respect to Severn Trent’s financial condition
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