RNS Number:3718J
Severn Trent PLC
31 March 2003

SEVERN TRENT

PRE-CLOSE PERIOD TRADING STATEMENT

31 March 2003

Severn Trent is starting its usual analysts meetings ahead of the close period
prior to the announcement of results for the year ending 31 March 2003. In these
meetings the following trading update for the 2002/03 financial year will be
provided.

The Board considers that, overall, the Group's performance for 2002/03 is
broadly in line with its expectations.

Severn Trent Water has continued to outperform its regulatory targets for gross
operating cost efficiencies although, as has been previously described, there
are offsetting cost pressures. For completed capital schemes in AMP3 to date,
Severn Trent Water has achieved average capex efficiencies of around 7% against
the OFWAT targets. In addition, Severn Trent Water has had a good year in terms
of service and quality.

The results of the IDOK application last Autumn and the RPI figure for November
2002 mean that Severn Trent Water's regulated prices for the financial year 2003
/04 will be increased on average by approximately 4.75%. However, in 2003/04
there will be continuing cost pressures and, reflecting the capital expenditure
programme, increases in depreciation are expected.

Conditions in the UK waste market continue to be difficult. In particular, this
is impacting industrial/commercial volumes in Biffa's three business sectors in
the UK - collection, landfill and special waste. However, municipal contracts
and pre-treatment activities within collection, electricity generation and Biffa
Belgium have performed well. Biffa's PBITA (including Biffa Belgium) is expected
to be down year-on-year by approximately 7% to 10%, or down by approximately 0%
to 3% if the contribution from foot-and-mouth is excluded from last year.

Services' total PBITA, including the impact of exchange rates, is expected to be
broadly similar year-on-year. Although Services has continued to be impacted by
the difficult economic environment, laboratories has performed well and,
reflecting management actions, water purification has improved its performance
in the second half of the financial year.

The Group's results for the year ending 31 March 2003 will be announced on 10
June 2003.

Footnotes:

1   PBITA is profit before goodwill amortisation, interest, tax and exceptional 
    items.


2   The final dividend, subject to approval by the shareholders at the Annual 
    General Meeting, will be paid on 1 October 2003 based on a record date of 
    20 June 2003. The ex-dividend date will be 18 June 2003.

3   The Group's interim results for the half-year ending 30 September 2003 are 
    expected to be announced on 9 December 2003.

4   There will be a presentation for analysts and investors on Biffa, led by 
    Martin Bettington, at 4.00pm on Thursday 3 April 2003. This presentation 
    will be available as a simultaneous telephone dial-in facility on 01296 480 
    100, quote access code C323 952, with the presentation slides being 
    available on the Severn Trent website (www.severntrent.com). A playback 
    facility will be available on the Severn Trent website for 7 days following 
    the presentation.

5   This document contains certain "forward-looking statements" with respect to 
    Severn Trent's financial condition, results of operations and business and 
    certain of Severn Trent's plans and objectives with respect to these items.

    Forward-looking statements are sometimes but not always, identified by their 
    use of a date in the future or such words as "anticipates", "aims", "due", 
    "could", "may", "should", "expects", "believes", "intends", "plans", 
    "targets", "goal" or "estimates". By their very nature forward-looking 
    statements are inherently unpredictable, speculative and involve risk and 
    uncertainty because they relate to events and depend on circumstances that 
    will occur in the future.

    There are a number of factors that could cause actual results and 
    developments to differ materially from those expressed or implied by these 
    forward-looking statements. These factors include but are not limited to, 
    changes in the markets in which the Group operates; changes in the 
    regulatory frameworks in which the Group operates; the impact of legal or 
    other proceedings against or which affect the Group; and changes in interest 
    and exchange rates.

    All subsequent written or verbal forward-looking statements attributable to 
    Severn Trent or any other member of the Group or persons acting on their 
    behalf are expressly qualified in their entirety by the factors referred to 
    above. Severn Trent does not intend to update these forward-looking 
    statements.

Enquiries:
Alan Perelman                      Severn Trent                  0121 722 4176 *
Group Finance Director

Peter Gavan                        Severn Trent                  0121 722 4310 *
Director of Corporate Affairs

Julian Wais                        Severn Trent                  0121 722 4176 *
Head of Investor Relations

Simon Holberton and                Brunswick Group                020 7404 5959
Tim Grey


*      Enquiries 7.00am-9.30am on Monday 31 March 2003:
           Alan Perelman/Julian Wais             : 020 7233 3914
           Peter Gavan                           : 020 7233 3917



Ends




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