Down today (ex big div) but severn trent seem to have an almost perfect large inverse H&S beginning in mid Jul and completing last week. 680ish is going to be an interesting level either way.

Trading update http://www.moneyam.com/action/news/showArticle?id=5206080

Recommended Acquisition of Dee Valley Group Plc by Severn Trent Water Limited, a wholly owned subsidiary of Severn Trent Plc
Summary
· The Boards of Dee Valley and Severn Trent are pleased to announce that they have reached agreement on the terms of a recommended acquisition of the entire issued and to be issued voting and non-voting ordinary share capital of Dee Valley by Severn Trent Water.
· Under the terms of the Acquisition, Dee Valley Ordinary Voting Shareholders will receive 1,705 pence in cash per Dee Valley Ordinary Voting Share they hold. The Acquisition includes a comparable cash Offer for the Dee Valley Ordinary Non-Voting Shares priced at 1,601 per share, in accordance with Rule 14 of the Code. The Acquisition values the entire issued ordinary share capital of Dee Valley at approximately £78.5 million.
· Dee Valley is a natural fit for Severn Trent as it operates in neighbouring areas in England and Wales.
· Severn Trent intends to maintain a separate Welsh licence for Dee Valley and, subject to regulatory approval, intends that the whole of Severn Trent's business in Wales will be regulated under Welsh Government Policy.
· Severn Trent is one of the leading water companies and intends to enhance the current service offering for Dee Valley's customers, including by extending support for vulnerable customers. Dee Valley's customers will share in half of any wholesale cost efficiencies achieved, which will be reflected in future bills.
· Severn Trent is undertaking an over £3 billion investment programme in AMP6. Severn Trent intends to fully support continued investment in infrastructure in the Dee Valley region.
· Severn Trent is confident that, through the application of Severn Trent's successful operating model, economies of scale and lower cost of financing to the operations of Dee Valley, this will deliver attractive returns to Severn Trent shareholders. The Acquisition is expected to be earnings accretive from completion.
· The Dee Valley Board believes that the terms of the Acquisition are in the best interests of Dee Valley Ordinary Shareholders as a whole and intends to recommend unanimously that:
- Dee Valley Ordinary Voting Shareholders vote in favour of the resolutions to be proposed at the Court Meeting and the General Meeting which are to be convened to approve the Acquisition; and
- Dee Valley Ordinary Non-Voting Shareholders accept the Offer.
· The Offer is conditional on the Scheme becoming Effective. However, the Scheme is not conditional on the Offer becoming or being declared unconditional in all respects.
· The Dee Valley Board has withdrawn its recommendation of the acquisition by Ancala and proposes to adjourn the meetings in respect of Ancala's acquisition.

StockMarketWire.com
Dee Valley Group's board has withdrawn its recommendation of Ancala Fornia's offer and urged shareholders to accept a revised offer from Severn Trent.

Under the terms of the revised acquisition, Dee Valley ordinary voting shareholders will receive 1,825 pence in cash for each Dee Valley ordinary voting share. The revised acquisition includes a revised comparable cash offer for the Dee Valley ordinary non-voting shares priced at 1,713 pence per share.

It is intended that the revised acquisition of the Dee Valley ordinary voting shares will be implemented by means of a court-sanctioned scheme of arrangement. The revised acquisition values the entire issued share capital of Dee Valley at approximately £84.0 million.

The Dee Valley board considers that the revised acquisition represents a superior offer in terms of financial value for holders of Dee Valley ordinary voting shares and non-voting shares as compared with the revised Ancala proposal.

The Dee Valley board intends to recommend unanimously that:
- all Dee Valley ordinary voting shareholders vote in favour of the revised scheme and all holders of non-voting shares accept the Revised Severn Trent contractual offer.

Severn Trent declared another chunky dividend and said it planned an enhanced payout next time after spying further efficiencies it can make for the year ahead. In the year to end-March, the water supplier increased turnover 3.7% to £1.8bn, underlying profit before interest and tax by 4.3% to £525m and underlying earnings per share by 19.9% to 122.4p. It proposed a final dividend of 48.90p that takes the annual payout to 81.50p, up 1% on the previous year.

Severn Trent sells North American business

Severn Trent has confirmed the the sale of its North American business (Operating Services, US) to US investors PPC Enterprises LLC and Alston Capital Partners LLC.

The sale valued the business at $62m. Proceeds would be used for general corporate purposes.

Severn Trent's North American business operated and managed water and wastewater systems, and provided management services to municipalities and local communities.

It operated in all aspects of the water and wastewater process including treatment, networks and customer service.

Story provided by StockMarketWire.com

StockMarketWire.com
Severn Trent's underlying profit before interest and tax (PBIT) increased by 4.4% to £287.8 million in the six months to 30 September, driven by the acquisition of Dee Valley, operating cost control and lower infrastructure spend.

Group turnover from continuing operations was £850.4 million, an increase of 3.7%, mainly due to allowed price increases in the Severn Trent Regulated Water and Waste Water business, the acquisition of Dee Valley and growth in both Business Services businesses.

There were exceptional gains of £8.3 million arising from a further pension increase exchange arrangement that has been agreed with the trustees of the Severn Trent Pension Scheme.

Reported group PBIT was £296.1 million, down slightly from £296.7 million the year before.

Net finance costs were £110.5 million (2016/17: £98.5 million) reflecting the impact of higher RPI, the effective cash cost of interest was around 20 basis points lower compared to the same period last year.

The company achieved a 38% reduction in internal sewer floodings and a 50% reduction in external floodings.

It is now generating the equivalent of 38% of energy needs from renewables and is on track for 50% by 2020.

Liv Garfield, chief executive of Severn Trent, said: "Our customer-first approach is delivering positive results. It is also clear in today's society that businesses, including the water sector, are under increasing scrutiny and greater pressure to explain their contribution to society beyond financial profit. We need to make sure our decisions strike the right balance between all of our stakeholders and show we run our business in a sustainable and responsible way."

Goldman Sachs today initiates coverage of Severn Trent PLC (LON:SVT) with a sell investment rating and price target of 1881p.

Trading Update for the period 1 October 2017 to 7 February 2018

Severn Trent, a leading UK water and waste water company, today provides its trading update.

Financial outlook: The Board continues to expect that the Group will deliver FY17/18 trading performance in line with its expectations and guidance previously disclosed at the HY17/18 results presentation on 23rd November 2017. We also reaffirm that at least £50 million customer ODI(1) outperformance payments are expected to be earned this year.

Delivering sustainable performance for all stakeholders:

AMP6(2): We are focused on providing benefits to our customers, communities, colleagues and investors, and we have generated sector-leading outperformance payments on key customer ODIs and continue to do well year-to-date.

We have positive momentum on Waste, particularly on internal and external sewer flooding, category 3 pollutions and serious pollution incidents. We re-confirm that we will hit the AMP6 outperformance cap(3). On Water, we have had more supply interruptions than normal in the last quarter, but are encouraged by the reduction in water quality complaints, which were down 12% year on year. We confirm that we expect to earn at least £50 million customer ODI(1) outperformance payments across Waste and Water this year.

We continue to work hard on improving our SIM(4) scores. We also note that we have one of the sector-leading scores in CCW's(5) independent annual survey on what our customers think.

We have delivered material reductions in our cost of finance. Since our HY17/18 results announcement, a £400m fixed-rate sterling bond with a coupon of 6% matured and was refinanced in part with a £250m five-year sterling bond with a coupon of 1.625%. We continue to explore varied sources of finance to help positon us as an upper-quartile performer in AMP7.

AMP7(2): Ofwat announced its PR19(6) Final Methodology in December 2017, providing welcome clarity on upcoming plans. We expected a tough review, recently restructuring our wholesale business to improve operational effectiveness and our customers' experience. We are encouraged by the enhanced incentive regime, creating strong outperformance opportunities. We are positioning ourselves for continued success in AMP7.

To assist AMP7 planning, we have launched our largest ever customer engagement programme, including a community panel of 10,000 customers, a review of two million customer contacts and analysis of over seven million social media conversations. This helps us understand the core service improvements and wider social and environmental initiatives our customers expect, thereby underpinning future growth in our RCV(7).

Corporate social responsibility: We are conscious of Severn Trent's role in society through the impact on our community, the wider environment, and the importance of workplace diversity. Our work in the community delivers benefits through our extensive customer education and employee volunteering programmes. We are keen to play our part in supporting social mobility and we have a highly-rated apprentice programme. We have reported a gender pay gap of 2.4% and, while we have even further to go, we have made strong progress in supporting workplace diversity and gender pay equality. We have a strong record of environmental performance and through our renewable energy business we are on track to generate the equivalent of 50% of our energy needs by 2020.

JP Morgan Cazenove today upgrades its investment rating on Severn Trent PLC (LON:SVT) to overweight (from neutral).

StockMarketWire.com
Water company Severn Trent reported a slight fall in annual profit after higher costs offset a rise in revenue.

Profit before interest and tax declined by 1.5% to £528.4m, despite revenue rising 3.4% to £1.69bn.

On an underlying basis, profit before interest and tax rose 4% to £541m.

The company declared a dividend of 51.92p, taking the 2017/18 dividend to 86.55p.

StockMarketWire.com
Water and waste utility Severn Trent said it had made a 'good' start to the year, with no material change to its outlook since it delivered its full-year results in May.

'The board continues to expect that the group will deliver full-year trading performance in-line with its expectations and prior guidance,' the company said.

Severn Trent said it was on track with a £100m reinvestment announced in May as it prepared for the UK's new regulator investment framework, known as AMP7.

'Our business plan for AMP7 is progressing well and we are confident we can present a plan this coming September which balances the needs of all of our stakeholders for the next regulatory period,' the company said.

'We remain supportive of Ofwat's approach and welcomed the recent decisions on the 'Putting the sector back in balance' consultation.'