Shares in Severn Trent (LON: SVT) experienced a 0.9% lift following a trading update on Wednesday, indicating the company is on track to meet environmental and operational targets, with financial performance aligning with expectations.
The water company's positive outlook is largely attributed to its capital investment program.
Severn Trent anticipates delivering towards the upper end of its £1.7 billion – £1.9 billion capital investment guidance range, marking its highest-ever year. This projection is fueled by the benefits of insourcing and early scaling of its strategic programs.
The company remains confident in securing at least £40 million in rewards from Outcome Delivery Incentives (ODIs) and Price Control Deliverables (PCD) performance. Severn Trent expects to achieve all PCD milestones and associated rewards for the year.
Environmental performance continues to improve year-on-year, with Severn Trent poised to earn a 4-star Environmental Performance Assessment (EPA) for a record seventh consecutive year. This achievement underscores the company's commitment to sustainable practices.
James Jesic, Chief Executive of Severn Trent Plc, stated, “This has been a quarter of delivery in a period of strong growth, and I am proud of the contributions of the whole team. Having taken the reins as CEO, I'm meeting every Severn Trenter face to face, and it's brilliant to see the level of energy and focus the organisation has on delivering for our customers and communities”.
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