Profits down as Severn Trent plugs leaks

Water firm Severn Trent said it had reduced leakage to a record low level as it pledged to invest an additional £150 million in its network.

Severn, which supplies eight million households and businesses stretching from Bristol to the Humber, said the amount of water lost through leaks fell 7 per cent in the year to the end of March, below the target set by the regulator.

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This, and a 1.6 per cent fall in consumption, helped the company to repeat its expectation that it will not have to enforce a hosepipe ban over the current financial year.

The group will spend an additional £150 million over the next three years to enhance water security, on top of the £1.6 billion already planned.

Underlying pre-tax profits fell 4.6 per cent to £275.3 million in the year, despite a 3.5 per cent increase in turnover to £1.8 billion, after a weaker performance from its services arm.