Severn Trent Water "It's all perfectly legal"

JohnD said:
"Since Trimpley was added to the accounts in 2017, Severn Trent Water Ltd has paid out £1.615bn in dividends.

Profits over the same period were £1.246bn, so Severn Trent Water has paid out £369m more than it made in profit during that period. It looks like cash is being drained from the regulated water company. "
Click to expand...
seems clear to me - perhaps mbk can take one of Carman's famous comprehension classes.
 
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You might interpret the above as 1.62bn paid out vs 1.25bn profit which on the face of it is an unlawful payment under the companies act.

However, read it again and you will see they are referring to profit of one entity not the group.

So again. If there is no allegation of an illegal dividend, we are left with not much at all.
 
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What is your definition of cooking the books and Who is cooking them?
 
motorbiking said:
Who is cooking them?
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Severn Trent.

"One of England's top-rated water companies is using an accounting trick to artificially inflate its balance sheet by more than a billion pounds, BBC Panorama has discovered."

"The made-up money makes the company appear more financially robust and helps to support its bumper payouts to shareholders."
 
Draycote is a rather large freshwater reservoir. 5t gallons built ~1970 for the Rugby and Coventry area. It's pumped and operational. Certainly worth more than £2.
 
denso13 said:
Severn Trent.

"One of England's top-rated water companies is using an accounting trick to artificially inflate its balance sheet by more than a billion pounds, BBC Panorama has discovered."

"The made-up money makes the company appear more financially robust and helps to support its bumper payouts to shareholders."
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It's not made up money. The debt is accounted for in Draycote's accounts.

See structure

Our corporate structure | Our investment proposition | Investors | Severn Trent Plc

How the businesses within Severn Trent Group relate to each other
www.severntrent.com www.severntrent.com

If it's over valued as an asset and under reported as a debt, then there is an argument. But the debt appears to be balanced well before you get to the dividend paying "TopCo".
 
ajohn said:
Draycote is a rather large freshwater reservoir. 5t gallons built ~1970 for the Rugby and Coventry area. It's pumped and operational. Certainly worth more than £2.
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not if it has 3bn of "bad debt" :LOL:
 
motorbiking said:
It's not made up money. The debt is accounted for in Draycote's accounts.

See structure

Our corporate structure | Our investment proposition | Investors | Severn Trent Plc

How the businesses within Severn Trent Group relate to each other
www.severntrent.com www.severntrent.com

If it's over valued as an asset and under reported as a debt, then there is an argument. But the debt appears to be balanced well before you get to the dividend paying "TopCo".
Click to expand...
And none of that is the point.

Well swerved
 
except you both have debts of 1bn. so your balance sheet is balanced.

If the corporate structure is Denso PLC made up of Denso Ltd and Desno-wife Ltd. each with a billion in asset and a billion debt. TopCo Denso PLC has zero profit to pay a dividend.

Now If Denso Ltd buys shares in Denso-wife of 2bn and wife reciprocates then you have 2Bn of fake value and interest against the "loans" and fake profit.
 
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