Severn Trent posts profit rise ahead of Ofwat decision

24th Nov 2009 07:04

Water supplier Severn Trent posted a rise in turnover and profits in the six months to September 30 and lifted its dividend ahead of the regulator's final decision on how much it can charge customers over the next five years.Underlying pre-tax profits climbed to £188m from £154.5m on revenues that climbed to £852.1m from £814.3m. The interim dividend was lifted by 1.6% to 26.71p.Severn, which provides water and sewerage services to nearly 4m customers in the English Midlands and Wales, will find out on Thursday the regulator Ofwat's final determination on how much it can charge customers up to 2015. Ofwat has already indicated that household bills will have to fall by 8% in real terms over the period. 'We will take the time necessary to thoroughly review its entire content before making our own conclusions and responding to our stakeholders,' said the company.Severn said it was seeing declines in consumption, but had introduced a 5.3% price increase, including inflation, from April 1. Yesterday, Severn's peer Northumbrian said the final decision by the regulator Ofwat on how much it can charge customers over the next five years is a 'key risk' as it also posted a rise in profits on the back of previous price rises.