Severn Trent Group has announced that its turnover stood at £1.77bn for the year ended 31 March 2012, an increase of 3.5 per cent on the previous year, but suffered a significant fall in group profit before tax.

Profit before tax for the group was £156.7m, a 38 per cent decrease on 2011, but this includes losses on 'financial instruments' of £67.7m.

Underlying group profit before tax also decreased, to £275.3m from £288.6m in 2011.

Turnover for Severn Trent Water increased by 4.9 per cent in 2012 to £1.46bn. Sales prices increased through inflation which gave rise to an increase in turnover of £73.1m while an increase in metered customers and reduced consumption meant a decline in turnover of £10.5m.

Underlying profit before taxes and interest (PBIT) was down by 0.7 per cent on the same period last year to £500m. Direct operating costs increased by £32.5m and there was an increase in infrastructure renewals expenditure of £32m.

During the financial year the water company invested £474.2m in fixed assets and maintaining and improving its infrastructure.

Severn Trent Water is planning an additional investment of £150m in its networks over the coming three years, on top of £1.6bn already planned.

Turnover at Severn Trent Services fell by 1.1 per cent from 2011 to £332.3m, while PBIT was £18m, a fall of 30 per cent on 2011’s figure of £25.7m, accounting for much of the group's losses. 

Tony Wray, Chief Executive Severn Trent Plc, said:

“During the period we have delivered on our commitments to our stakeholders. We have beaten our leakage target, reduced supply interruptions, continue to forecast no water usage restrictions for our region this year and we maintained the lowest average charges for our customers.

We delivered stable underlying PBIT in Severn Trent Water, despite incurring additional network investment costs, new costs such as private drains and sewers and the new Carbon Reduction Commitment levy. In aggregate these added over £40 million to our cost base year on year.

Our ability to achieve this performance is due to the great work our people have put in over the last 3 years and the productivity and capital efficiency improvements that have been delivered.

At Severn Trent Services, whilst activity levels have started to improve, full year performance was down.

For the group as a whole, our strong balance sheet and investment grade credit rating enable us to share that benefit with our customers and investors by increasing our investment programme in our water and waste water networks by £150 million, to improve further our services to customers, and return an additional £150 million to our shareholders.”