Yahoo Finance Severn Trent HY profit rises despite elevated expenses
By Scott Kanowsky
Investing.com -- Severn Trent PLC (LON:SVT) reported a rise in first half group income, as a surge in top-line growth was partially offset by higher input costs and "unprecedented" energy prices.
Group profit before interest and tax for the six months to September 30 edged up by 2.4% to £261.7 million (£1 = $1.1839).
Turnover during the period came in at £1.06B, up by 10.8% compared to the same timeframe last year, thanks mainly to strong performance at Severn Trent's regulated water and waste water division. The unit was boosted by a recent spike in inflation, which helped push up revenues from tariffs by nearly £40M.
However, the increase in prices led to power expenses jumping by 75.3% to £41.1M. Costs from infrastructure maintenance registered £22.7M as well.
"Pumping water and waste water treatment are energy intensive activities and, in common with other large users of energy, we have seen significant increases in energy prices," said chief financial officer James Bowling in a statement.
The group also pointed to challenges from "extreme" weather conditions in the U.K. this summer, which threatened water pipes. But the company said it had successfully limited disruption to customers, adding that supply interruptions were "minimal."
Shares in Severn Trent edged down by more than 2% in early trading on Tuesday.
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