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Severn Trent raises £250mln to fund green initiatives

On Monday, the water utility said it would invest £565mln to upgrade its infrastructure

Severn Trent -

Severn Trent PLC (LON:SVT) is tapping shareholders for £250mln to help fund six projects for the government’s Green Recovery programme.

On Monday, the water utility said it would invest £565mln to upgrade sewage works, bolster storm overflows and improve water quality monitoring.

To help meet the cost, SVT said it will issues shares to institutions through a bookbuild and to retail investors by an offer run by PrimaryBid.com.

Liv Garfield, chief executive, added: "We took a very early decision to be at the forefront of efforts to help our region bounce back.

"That is why it was such good news that we'd been successful with our Green Economic Recovery proposal, meaning we can invest even more in sustainable projects and help create thousands of jobs.“

SVT also published results for the year to end March 2021, which showed underlying profits falling by 17% to £473mln due to new tariffs, the net impact of COVID-19 on consumption and additional investment to improve customer service.

Pre-tax profits fell 44% to £267.2mln. while turnover eased 1% to £1.83bn.

SVT had previously said revenues would fall by between £50mln to £85mln with the actual outcome at the low end of this range,

Bad debt costs were down year-on-year reflecting strong household customer cash collections though Severn Trent said it had made an additional provision to account for forecasted COVID-19 related rises in unemployment.

The dividend for the year rises by 1.5% to 101.58p.

Quick facts: Severn Trent

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