National Grid Plc - Full year results 2018/19

Operational Highlights

·    £4.5bn of capital investment leading to strong asset growth of 7.2%

·    Cadent sale expected to complete in June with £2bn in equity proceeds

·    Good regulatory progress in the US with all our companies now operating under refreshed rates

·    Launched new cost efficiency programmes in both the UK and US

·    Significant progress on interconnector portfolio

·    Major milestone achieved for Property business with sale of Fulham site to St William JV

·   Reached agreement on new employment terms with unions in Massachusetts Gas

Financial Performance

·   Underlying operating profit down 2% to £3.4bn (4% at constant currency) reflecting expected return of Avonmouth allowances and US tax reform, partly offset by higher property profit and favourable US legal settlements

·   Statutory operating profit down 18% to £2.9bn

·    Underlying EPS up 5% to 58.9p reflecting a lower share count

·    Statutory EPS of 44.3p due to exceptional charges:  Massachusetts Gas; new efficiency programmes; cancellation of nuclear connection agreements

·    Group RoE of 11.8% (2018: 12.3%)

·    Recommended full year dividend of 47.34p

 

 

Financial Summary

Year ended 31 March - continuing operations

 

 

 

Statutory results

 

Underlying[1]

 

 

 

2019

2018

% change

 

2019

2018

% change

 

Operating profit (£m)

 

2,870

3,493

(18)

 

3,427

3,495

(2)

 

Profit before tax (£m)

 

1,841

2,660

(31)

 

2,474

2,538

(3)

 

Earnings per share (p)*

 

44.3

102.5

(57)

 

58.9

56.2

5

 

Capital investment (£m)

 

4,506

4,251

6

 

4,506

4,251

6

 

3,386m weighted average shares for 2018/19 (2017/18: 3,461m).

* For 2018/19, total exceptional charges (pre-tax) were £624m (see pages 15 and 16 for further details). For 2017/18, statutory EPS includes 43.8p for the impact of £1.5bn exceptional accounting credit relating to US tax reform.

 

 

John Pettigrew

Chief Executive

"We made good strategic progress across the Group last year, delivering £4.5bn of investment driving strong asset growth of 7.2%, all while maintaining reliability and safety across all of our networks.

 

During the year we launched new efficiency programmes to become a leaner, more agile organisation. In the US, we continued to make good regulatory progress and we reached agreement on new employment terms with unions in Massachusetts Gas. We delivered good returns in the UK and we made significant progress on our interconnector portfolio. We also took our first step into developing US renewable generation with the agreement to acquire Geronimo Energy.

 

Looking ahead, we will continue to contribute to the important regulatory agenda in the UK and the US, to create value for shareholders, and play a central role in driving decarbonisation. Having delivered almost £640m of savings for UK customers over the last six years, efficiency remains a key focus as does continued investment, which will increase to almost £5 billion each year for the next two years. We remain on track to achieve asset growth at the top end of our 5-7% range in the medium term."