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Water company Severn Trent has said that the summer's wet weather hit its revenues by reducing consumption levels.

However the utilities firm says it has delivered a first-half performance broadly in line with expectations.

"Whilst the wet weather conditions seen over the recent summer months have had a beneficial effect on reservoir levels, they have also reduced consumption levels.

"As a result, we expect full year revenues to be around £12 million lower than we would have anticipated," Severn Trent said in a trading statement.

Britain suffered its worst flooding in 60 years this summer, as torrential rain battered the country, causing billions of pounds worth of damage to homes and businesses.

Severn Trent, whose customers were among those worst hit by the floods, today repeated its assertion that the company is likely to face costs of between £25 million and £35 million as a result.

However the UK's second-biggest water company said that it expected the cost to be partially offset by insurance recoveries of between £10 million and £20 million.

Severn Trent added that excluding exceptional flood costs it remains on track to meet operating cost targets set by industry regulator Ofwat.

It said a fall in energy prices had helped to keep operating expenditure down, with total energy costs expected to be around £17 million lower this year.

Meanwhile first-half infrastructure renewals expenditure for the 2007-08 financial year is expected to be within the range of £46 million to £48 million, representing around 40 per cent of total net expenditure for the year.

Ahead of interim results on November 27th Severn Trent also revealed that sales prices across its water and sewerage business increased by 5.87 per cent in the six months from April 1st.