Severn Trent to increase shareholder dividends as water bills rise

Water elephantine Severn Trent has said it plans to manus shareholders a higher dividend for the adjacent twelvemonth arsenic trading remains successful enactment with targets.

It said its fiscal show up to January 23 “remains connected track”, with it acceptable to conscionable its guidance for the afloat fiscal year.

As a result, the institution said it expects to manus retired a dividend of 126.02p to shareholders for the 2025/26 fiscal year.

The institution said this is an inflation-based summation from the 121.71p dividend it already announced for the existent fiscal year.

The summation comes amid important scrutiny implicit the level of payouts successful the sector, against a backdrop of rising lawsuit bills and concerns implicit leaks.

Last month, regulator Ofwat fined troubled Thames Water £18.2 cardinal for paying £158.3 cardinal successful dividends to shareholders which it said were not justified.

Severn Trent said it has projected the accrued dividend aft considering the last determination which was revealed by the regulator past month.

In the last determination, Ofwat said that Severn Trent volition beryllium capable to summation lawsuit bills by an mean of 47% implicit the adjacent 5 years.

The institution said the measure emergence volition assistance its efforts to halve spills by 2030, trim contamination by 30% and trim leakage by a further 16%.

On Friday, Severn Trent besides reported that it expects a £100 cardinal payment from result transportation incentives (ODIs) for 2024, a regulatory model which rewards firms which conscionable show targets but compensates customers for firms who miss these targets.