Trading Statement

Pennon Group PLC 17 September 2003 17 September 2003 PENNON GROUP PLC PRE-CLOSE TRADING UPDATE Pennon Group Plc today reports on trading for the six months to 30 September 2003, prior to entering its close period, and confirms that trading to date remains in line with market expectations. SOUTH WEST WATER LIMITED On 29 August, South West Water Limited published a summary of its Draft Business Plan. This document is the most recent milestone of the 2004 Periodic Review process set out by Ofwat, the economic regulator. The Review, to be completed by the end of 2004, will set water and sewerage prices for the period April 2005 to March 2010. A summary of the Plan can be viewed on South West Water's website (www.southwestwater.co.uk). South West Water remains on track to deliver its strategy of outperforming the current regulatory contract. VIRIDOR WASTE LIMITED Churngold Holdings Limited, a waste recycling and transfer business, was acquired for £19.7 million in June 2003. The acquisition was a natural extension of the Group's strategy of expanding its waste management activities through Viridor pursing profitable opportunities arising from the Government's developing waste strategy. Churngold has an excellent geographic and business fit within Viridor's existing operations and the acquisition is expected to be earnings enhancing before goodwill in the first full year, 2004/05. Trading year to date has been strong and the Group remains confident of delivering full year growth in operating profit before goodwill from Viridor Waste. Pennon is scheduled to announce its interim results on Thursday, 27 November 2003. For further information, please contact : Pennon David Dupont - Group Director of Finance 01392 443381 Jo Finely - Investor Relations Manager 01392 443401 Financial Dynamics Andrew Dowler 020 7831 3113 End transmission This information is provided by RNS The company news service from the London Stock Exchange

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