14th Nov 2019 08:14
(Alliance News) - FTSE 100 electricity firm National Grid PLC delivered a "solid" financial performance, it said Thursday, with organic growth at the top end of targets.
Pretax profit for the six months to September 30 fell 23% to GBP404 million, and on an underlying basis the figure was 4% lower at GBP785 million.
Profit fell, National Grid said, due to higher interest charges included mark-to-market financial remeasurements, which were partly offset by lower taxes.
London-headquartered National Grid's revenue fell 0.9% to GBP6.29 billion. The firm has increased the interim dividend by 3% to 16.57 pence per share.
"In the first half of this year we have delivered solid financial performance and continued to deliver strong organic growth at the top end of the 5% to 7% range," said Chief Executive John Pettigrew.
National Grid's UK gas and electricity businesses have continued a "good" level of performance. It said a major power outage in the UK in August was likely not due to failures on the part of the network or operators, and added a cost efficiency programme is on track.
In the US, the company is "efficiently" delivering growth, though it noted issues within operations in New York State. The firm has been trying to build a gas pipeline in the area, which has been blocked by regulators, and since that decision National Grid stopped processing customer applications for new or expanded gas services.
Earlier this week, New York State Governor Andrew Cuomo threatened to revoke National Grid's licence if the situation is not resolved within 14 days. National Grid on Thursday said it is "confident" on addressing issues raised by Cuomo.
National Grid has also announced a plan to become net carbon neutral by 2050.
"Today's announcement that we are increasing the group's own emissions reduction target from 80% to net zero by 2050 underlines our commitment to lead the industry towards a cleaner energy future," said Pettigrew.
"This objective will be supported by work in other areas, such as offering further energy efficiency programmes for our US customers, proposals for renewable natural gas and hydrogen blending programmes."
Looking ahead, National Grid expects a "good" financial performance in the US for the second half, with the UK likewise expected to continue to outperformance. It expects asset growth of 7% in the near term, and GBP5 billion of annual capital investment.
"With an efficient balance sheet that underpins asset and dividend growth, the group is well positioned to create value for shareholders," said National Grid.
The stock was 1.4% higher on Thursday in early trade in London at 904.20p per share.
By George Collard; [email protected]
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