LONDON (ShareCast) - - Trading in line with guidance
- Opex, capex and bad debt all in line
- Annual dividend expected to be up 5.6% to 84.9p

Ahead of an annual general meeting where new Severn Trent Chief Executive Liv Garfield is expected to face fierce opposition to her bonus pay, the group assured that trading across the group was in line with expectations and prior guidance.

Prices within the regulated Severn Trent Water business increased by 1.5% from April 1st, lower than inflation, with consumption for the full year still expected to be lower year-on-year.

Running costs, capital investment on improving pipes and drains and bad debt with customers were all kept in check.

Normal operating expenditure rose slightly, in line with expectation for the year, due to inflation and increases in taxes and power costs that are only partially being offset by efficiency improvements.

The capital investment programme is expected to remain in the range £510m-£530m, including an estimated £15m related to private drains and sewers.

In the much smaller non-regulated Severn Trent Services business, further growth is expected in Operating Services while the Products segment is expected to see the benefits of the current restructuring programme.

The board, which cautioned that the interest charge would be higher year on year due to higher net debt, has lifted the annual dividend 5.6% higher than the prior year to 84.90p.

Later on Wednesday management meets shareholders at the AGM, ahead of which investor group Pensions & Investment Research Consultants (Pirc) has warned shareholders that Garfield's remuneration policy is "excessive".

In an emailed statement it said: "Awards granted have previously been capped at 70% of salary for the chief executive and 50% for other executives. However, these have been greatly increased to 125% for the newly appointed CEO and 80% of salary for other executives."

Shares in Severn Trent were up 0.52% at 1,932p at 08:20 on Wednesday.



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