Severn Trent Share Price: Trading in Line with Expectations

iNVEZZ.com, Wednesday, July 17: Severn Trent Plc (LON:SVT), today issued a trading update for the period from April 1 to July 16. The UK water company based in Coventry said that trading across the group had been in line with expectations and prior guidance.

The Severn Trent share price was little changed at 1,747.00p at the opening bell today in London.
Interim statement
Customer prices in the group’s water business – Severn Trent Water – have increased by two percent from April 1.
The unit’s operating costs were expected to rise year over year due to the impact of inflation and increases in quasi taxes, partially offset by efficiency improvement, Severn Trent said.

The other main part of the group – Severn Trent Services – is expected to see benefits from previous investments in growth areas.
**LongRiver approach**
Severn Trent said it had incurred £19 million in costs for advisory, legal and other services while addressing an approach by LongRiver Partners in May about a possible takeover. The consortium led by Borealis Infrastructure Management abandoned its plans for Severn Trent last month, after the British group spurned its multiple approaches. Severn Trent felt that the bid, which last valued it at $8.2 billion, had failed to reflect its long-term value or potential.

**Low pressure**
!m[Operating Costs Expected to Rise due to Inflation](/uploads/story/4055/thumbs/pic1_inline.png)
As the BBC reported yesterday, Severn Trent Water was blaming low water pressure occurring in the Midlands on night-time garden watering. The company said that a running hose, a hosepipe or a sprinkler can use 220 gallons (1,000 litres) of water every hour, or more than the normal daily usage of a four-member family.

Severn Trent Water’s Marcus O’Kane explained that their reservoirs needed to refill during the night so that water was available to people in the morning.
Because some customers were leaving hosepipes or sprinklers running overnight “some of our customers are seeing lower pressure than normal and there is more risk if we have a problem somewhere on our network,” he added.
Severn Trent supplies water to 7.7 million people.
**The Severn Trent share price was at 1,752.37p as of 9:10 GMT, 17.07.2013**