Severn Trent dividend
Severn Trent pays £1.305 per share at the start of the forecast and its policy targets annual CPIH growth. Severn Trent's dividend is not covered by surplus free cash flow: free cash flow was negative £1.046bn while dividends were £371m.
How much does Severn Trent pay per share?
Dividends begin at £1.305 in every case, matching guidance. The base case rises to £1.338 and then £1.371, following 2.5% annual CPIH growth. The bear case holds at £1.305 before cutting to £1.20 as cash pressure intensifies. The bull case reaches £1.357 and then £1.411 because stronger delivery permits faster growth. The policy targets annual CPIH growth, but the negative cash flow and rising interest bill limit confidence.
| Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | |
|---|---|---|---|---|---|
| Revenue | 2,831 | 2,427 | 2,338.2 | 2,165.1 | 1,943.3 |
| Revenue growth (calculated) | 16.6% | 3.8% | 8.0% | 11.4% | 6.4% |
| EPS, diluted | 123.10 | 76.40 | 50.90 | 52.50 | -35.20 |
| Dividend per share | 126.02 | 121.71 | 116.84 | 106.82 | 102.14 |
Is Severn Trent's dividend covered by its cash?
The dividend is not being paid from surplus cash after all investment. In FY26, operational cash was £1.212bn. Cash capital expenditure was £1.884bn, and net interest paid was £341m. Free cash flow was therefore negative £1.046bn, while dividends were £371m; adjusted net debt rose by £1.509bn. That may be sensible if the new infrastructure later earns regulated income, but it makes financing part of the investment case.
| Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 | |
|---|---|---|---|---|---|
| Free cash flow | -1,045 | -966 | -614.2 | -172.5 | 81.2 |
| − Dividends paid | 371 | 356 | 301.4 | 261.3 | 254.5 |
| − Share buybacks | 0 | 0 | 0 | 0 | 0 |
| = Paid out more than the free cash flow | 1,416 | 1,322 | 915.6 | 433.8 | 173.3 |
| Paid out, % of free cash flow | not meaningful | not meaningful | not meaningful | not meaningful | 313.4% |
What this means. The company's own net debt is slightly different because it adjusts the basic debt-minus-cash calculation for leases, loans it expects to receive, and changes in debt values.
What could change Severn Trent's dividend?
The November 2026 interim results will test whether capital spending and interest are beginning to overwhelm operating cash. Further deterioration in free cash flow, debt headroom or funding access would move the forecast towards the bear case.
| October 2027 | October 2028 | October 2029 | |
|---|---|---|---|
| Earnings | 490 (390 / 550) | 590 (420 / 720) | 690 (450 / 900) |
| Shares (millions) | 303 (343 / 303) | 304 (344 / 303) | 304 (345 / 304) |
| Dividends per share | 1.30 (1.30 / 1.30) | 1.34 (1.30 / 1.36) | 1.37 (1.20 / 1.41) |
| Price to earnings | 16.00 (14.00 / 18.00) | 16.00 (12.00 / 20.00) | 16.00 (11.00 / 21.00) |