Adjust for the impact in the US from major storms, as well as currency movements, and utility giant National Grid's (NG.) operating profit rose 4 per cent year on year to £3.64bn - largely in line with analysts' expectations. But, more significantly, it has also settled negotiations with regulators in the UK and US - covering 80 per cent of its regulated asset base. Management has also committed to growing dividends at least in line with inflation.
In the UK, the transmission operating profit rose 19 per cent to £1.61bn while gas distribution profit rose 4 per cent to £794m. More importantly, however, regulator Ofgem has agreed the price control framework with the company for the next eight years. In the US, profit from the regulated business rose 5 per cent to £1.25bn meanwhile despite the costs associated from storms there, including Superstorm Sandy. Moreover, progress with US regulators has been made. Specifically, four rate cases were finalised with regulators and a further two settled, pending approval - combined, this covers around 55 per cent of the US rate base. Overall, capital investment increased by £291m to £3.7bn which, combined with lower cash flow, caused net debt to rise 9 per cent to £21.4bn.
Deutsche Bank expects adjusted pre-tax profit of £2.84bn for 2014, giving adjusted EPS of 54.6p (from £2.74bn and 54.2p in 2013).
NATIONAL GRID (NG.) | ||||
|---|---|---|---|---|
| ORD PRICE: | 830p | MARKET VALUE: | £30.4bn | |
| TOUCH: | 830-832p | 12-MONTH HIGH: | 850p | LOW: 636p |
| DIVIDEND YIELD: | 4.9% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 279p* | NET DEBT: | 209% | |
| Year to 31 Mar | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 15.6 | 1.39 | 32.3 | 31.2 |
| 2010 | 14.0 | 2.19 | 48.4 | 33.7 |
| 2011 | 14.3 | 2.62 | 62.9 | 36.4 |
| 2012 | 13.8 | 2.56 | 55.6 | 39.3 |
| 2013 | 14.4 | 2.92 | 62.6 | 40.9 |
| % change | +4 | +14 | +13 | +4 |
Ex-div: 5 Jun Payment: 21 Aug *Includes intangible assets of £5.6bn, or 153p a share | ||||
