The floods currently hitting major parts of Britain have made a substantial effect on the financial performance of the country, said Severn Trent. The country’s water utility company trades its performance in coalition with the previous guidance. Britain’s income base is supposed to be slightly rising, year-on-year. Even the sector peer Pennon agreed upon the “in line with expectations” factor during its trading update.
The country’s tax (PBIT), the underlying profit before interest, and non-regulated business of Severn Trent Services unit is now expected to be slightly lesser than the figures of the previous year. This is because the Products division’s shipments for the last two months have perpetually soared below expectations and the reason was continuing delivery delays and customer projects.
Nevertheless, the company’s South West Water unit is still functional and in its best-robust performance, despite the wretched weather and excessive flooding in the South West. According to the management the South West Water is suitably placed to surpass the claimed assumptions in the 2010-15 regulatory contract held with the industry, Ofwat.
The bad weather has also affected the Viridor waste management business, but Viridor is victoriously holding strong in its operational show in alliance with the operating contribution and management expectations as it is slightly ahead of last year, said the company.
Viridor’s PBIT is still hoping for the best and the company is augured to be affected by increased pension costs due to the auto-enrolment and breakdown previously flagged at its Lakeside Energy.
On the other hand, the shares in Pennon were ceased at 0.3% at 685.5p, while Severn Trent was little modified.