Trading Statement

SEVERN TRENT

PRE-CLOSE PERIOD TRADING STATEMENT

27 September 2004

Severn Trent is starting its usual analysts' briefings ahead of the close
period prior to the announcement of results for the half-year ending 30
September 2004. In these meetings the following trading update for the first
half of the 2004/05 financial year will be provided.

The Board considers that overall the Group has delivered a satisfactory first
half-year performance that is broadly consistent with its expectations for the
full year.

In the first half-year Severn Trent Water has continued to manage its opex and
capex costs and has delivered high levels of performance in terms of customer
service and drinking water and wastewater quality.

Severn Trent Water submitted its AMP4 Final Business Plan to Ofwat in April
2004. On 5 August 2004 Ofwat announced its draft determination for the AMP4
price review. Information on the draft determination is available on Ofwat's
website (www.ofwat.gov.uk). Severn Trent Water has responded to Ofwat and Ofwat
is expected to announce its final determination for the AMP4 price review on 2
December 2004.

Biffa's total PBITA (excluding the impact of additional pension charge - see
note 2 below) is expected to be around 13% to 17% ahead of the first half of
last year, benefiting from a full half-year of Hales. The Hales integration
process is now complete.

Services' total PBITA (excluding the impact of additional pension charge - see
note 2 below) is expected to be broadly similar to the first half of last year.
Laboratories has experienced difficult market conditions in the USA, whilst
Water Purification and Operating Services is continuing to perform well.

The Group's results for the 6 months ending 30 September 2004 will be announced
on 29 November 2004.

ENQUIRIES MONDAY 27 SEPTEMBER 2004:

Mark Wilson                  Severn Trent        0207 233 3914     
Group Finance Director                                             
                                                                   
Julian Wais                  Severn Trent        0207 233 3914     
Head of Investor Relations                                         
                                                                   
Peter Gavan                  Severn Trent        07901 517 447     
Director of Corporate Affairs                                                            
                                                                   
Eilis Murphy                 Brunswick Group     0207 404 5959     
                                                                   

AFTER 27 SEPTEMBER 2004:

Mark Wilson       : 0121 722 4267               
Julian Wais       : 07899 066 242               
Peter Gavan       : 0121 722 4310               

Footnotes:

1    PBITA is profit before interest, tax and goodwill amortisation but        
     excluding exceptional items.                                              
                                                                               
2    In Severn Trent's Preliminary Results announcement on 8 June 2004, the    
     Group advised that it expected a significant additional pension charge in 
     2004/05. This additional pension charge results from the normal triennial 
     valuations of the STWPS and the STSSPS and the analogous assessment of the
     Group's unfunded pension liabilities for senior staff. The expected       
     changes in PBITA stated in this Trading Statement exclude the impact of   
     this additional pension charge.                                           
                                                                               
3    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 economies and markets in which the Group operates; changes 
     in the regulatory and competition 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 written or verbal forward-looking statements, made in this document or
     made subsequently, which are 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.               
                                                                               
     This document is not an offer to sell, exchange or transfer any securities
     of Severn Trent Plc or any of its subsidiaries and is not soliciting an   
     offer to purchase, exchange or transfer such securities in any            
     jurisdiction. Securities may not be offered, sold or transferred in the   
     United States absent registration or an applicable exemption from the     
     registration requirements of the US Securities Act of 1933 (as amended).