A final dividend of 60.05p, which the water company said was in line with its policy, made for a full year payout of 100.08p compared to 93.37p a year ago.
The FTSE 100 group said its operations had remained resilient in the coronavirus crisis, adding that it has supported customers struggling to pay their bills and made £3.5mln available to further support those in need.
Turnover for the year to 31 March of £1.8bn was up 4% on the prior year, with reported profit before tax up 1% to £568mln.
Profit after tax tumbled 50% to £159mln.after an exceptional loss of £46.8mln from impairment of its long-term assets, bad debt charges, trading losses recorded before the impact of the virus and a £91.8mln exceptional deferred tax charge,
Severn Trent said it was “well-positioned to manage the financial impacts of Covid-19” with £755mln undrawn debt facilities, £200mln raised from a US bond sale and less than 2.5% of debt maturing in the coming year.
Having recorded a bad debt charge of £42.5mln for the past year, of which just £2.2mln was direct Covid-19 risks, the group said it “expects to see an increase in bad debt from higher unemployment and stressed household finances... and expect to see further Covid-19 related increases to our bad debt in future periods, based on the latest economic forecasts”.
The pension deficit was almost halved to £234mln reflecting a temporary spike in credit spreads at year-end and a lower long-term inflation forecast.
Shares in the company rose more than 1% on Wednesday morning to 2,435p, down around 3% since the start of the year.