National Grid(NGG)

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Here's Why You Should Add National Grid Stock to Your Portfolio Now
ZACKS· 2024-10-14 12:27
National Grid Transco's (NGG) is poised to benefit from its systematic investment plans. This should further help in the enhancement of its infrastructure. Given its growth opportunities, NGG makes for a solid investment option in the utility sector. Let's focus on the factors that make this Zacks Rank #2 (Buy) company a strong investment pick at the moment. NGG's Growth Projections The Zacks Consensus Estimate for fiscal 2025 earnings per share (EPS) has increased 2.4% to $4.63 in the past 90 days. The Zac ...
Fourth Annual National Grid Project C Week of Service Celebrates Company's Commitment to Its Communities
Prnewswire· 2024-09-16 13:00
Thousands of employees lend time and talent to local causes BROOKLYN, N.Y., Sept. 16, 2024 /PRNewswire/ -- More than 1,500 National Grid employees will step away from their desks to volunteer with community organizations and schools as they celebrate the fourth anniversary of the company's Project C initiative. The annual Week of Service commemorates the kickoff of Project C, which aims to create meaningful, permanent change and strengthen relationships in the communities where the company's employees live ...
Reasons to Add National Grid Stock to Your Portfolio Right Now
ZACKS· 2024-09-12 13:25
National Grid Transco's (NGG) strategic investment plans are likely to further expand its operations and boost its performance. Given its growth opportunities, the company makes for a solid investment option in the Utility sector. The company currently carries a Zacks Rank #2 (Buy). Let's look at the factors that are driving the stock. Growth Projections for NGG The Zacks Consensus Estimate for NGG's 2025 earnings per share (EPS) is pegged at $4.86, which indicates year-over-year growth of 6.2%. The consens ...
National Grid: An Upside Is There, But I'd Wait For A Small Drop
Seeking Alpha· 2024-08-25 12:00
FilippoBacci/E+ via Getty Images Dear readers/subscribers, I'll begin with a small apology on my part here because this coverage is about a month or two late. In my last article, I did give National Grid (NYSE:NGG) stock a "Buy" rating, and I stand by and will reiterate this rating in this piece. However, my latest buys and an actual near-doubling of my investment stake in this company were purchased in mid-June, following the crash from the company following funding needs. I was convinced that this funding ...
National Grid: Rights Issue Highlights Lack Of Compounding
Seeking Alpha· 2024-06-07 21:38
t 11:00 n II 100 National Grid Ple (NYSE:NGG)(OTCPK:NGGTF) is past the RIIO-ED1 compensation regime as of March 2023 and is now in ED2, and it's been working on the RIIO- T2 regime since 2021 for the transmission networks. ED2 was appealed and contested by operators, as always, over the fact that its compensation may not be sufficient for the operators of the transmission and distribution concessions. Not just now but also in 2021, lowered regulated cost of equity brings down compensation rates to the point ...
National Grid(NGG) - 2024 Q4 - Earnings Call Transcript
2024-05-24 21:37
Financial Data and Key Metrics - Underlying effective tax rate for the full year was 15.6%, 170 basis points lower than the prior year, driven by higher capital expenditure qualifying for full expensing in FY '24 [1] - Underlying earnings were GBP2.9 billion, with EPS at 78 pence, up 6% on the prior year [1] - Cash generated from continuing operations was GBP7.3 billion, up 13% compared to the prior year, largely driven by timing items in UK regulated businesses [1] - Group return on equity was 8.9%, in-line with expectations, and the Board recommended a final dividend of 39.12 pence, taking the full year dividend to 58.52 pence per share, a 5.55% increase compared to the prior year [47] Business Line Performance - UK Electricity Transmission saw a 47% increase in capital investment, reflecting early progress on ASTI projects, with underlying operating profit of GBP1.31 billion, up 19% year-on-year [30][41] - New York business achieved an 8.5% return on equity, with underlying operating profit of GBP1.02 billion, up 21% year-on-year, driven by rate increases and early recovery on Smart Path Connect investment [42] - National Grid Ventures reported underlying operating profit of GBP571 million, GBP120 million lower than the prior year, due to lower profitability at BritNed interconnector and lower business interruption recoveries at IFA1 [45] Market Performance - In the US, the company is investing nearly half of the GBP60 billion capital investment, a 60% increase compared to the last five years, with GBP17 billion expected CapEx in New York over the next five years [2] - In the UK, the company has been awarded 17 major projects under Ofgem's Accelerated Strategic Transmission Investment program, with investment expected to be in the mid-to-high teens billions [16] - In New England, the company expects to invest GBP11 billion over the next five years, a 60% increase, including $2 billion in incremental investment as part of the Massachusetts ESMP [53] Strategic Direction and Industry Competition - The company is shifting towards electricity, with 85% of the GBP60 billion investment aligned to the EU taxonomy, making it one of the biggest investors in decarbonizing energy in the FTSE [26] - The company is updating its strategy to become the preeminent pure-play networks business, focusing on growth opportunities in the energy transition, with a pivot towards electricity over the last three years [23][24] - The company is investing in large-scale projects, including the GBP4.4 billion Eastern Green Link 2 project and the $4 billion Upstate Upgrade program in New York, to improve reliability and resilience [2][31] Management Commentary on Operating Environment and Future Outlook - The company sees the energy transition accelerating, with governments on both sides of the Atlantic acting with greater urgency to incentivize renewable generation and transform networks [15] - The company expects to deliver around GBP60 billion of CapEx over the next five years, driving group asset growth of around 10% per annum and an EPS CAGR of 6% to 8% from FY '25 [26][73] - The company is confident in the regulatory frameworks evolving to attract the investment required, with Ofgem indicating its intent to create an investable proposition for future regulation [20] Other Important Information - The company has selected seven suppliers as part of its new GBP9 billion enterprise partnership model to enable delivery of onshore projects [19] - The company plans to sell its National Grid Renewables business and Isle of Grain LNG terminal, expecting significant interest in these assets [37] - The company has announced a GBP7 billion fully underwritten rights issue to support its investment program, with new shares issued at a 34.7% discount to the dividend-adjusted theoretical ex-rights price [51] Q&A Session Summary Question: Why did the company choose to raise equity now, and what other financing options were considered? - The company considered various tools, including hybrids, dividend rebates, and asset sales, but chose to raise equity to maintain a strong balance sheet and support the significant step-up in investment [60][152] - The company wanted to provide clarity to the market on the GBP60 billion CapEx plan and ensure the business plan submitted to Ofgem is fully financeable [84][186] Question: What are the assumptions behind the EPS growth guidance? - The company expects to deliver 6% to 8% EPS CAGR from FY '25, with growth driven by asset base expansion and operational performance, despite dilution from the rights issue [73][155] - The company has taken a conservative view on regulatory outcomes and assumes some hybrid issuance towards the latter part of the five-year plan [87] Question: What is the expected phasing of the GBP60 billion CapEx over the five-year period? - The company expects CapEx to peak at around GBP12-13 billion, with a relatively uniform step-up over the five-year period [146] - The company has good visibility on the timing of large projects, particularly in the UK, with 17 ASTI projects now embedded in license obligations [16][99] Question: How does the company view the attractiveness of its dividend policy in a lower inflation environment? - The company believes its dividend policy remains attractive, with an inflation-protected dividend and a focus on delivering a combination of growth and yield [133][140] - The company has not experienced deflation in the past and would likely honor the dividend rather than reduce it in such a scenario [166]
National Grid Commits to Investing $35 Billion in New York & Massachusetts to Meet Decarbonization Goals and Build a Stronger, Cleaner Grid
Prnewswire· 2024-05-23 10:45
Projects Across Northeast Will Harden Grid, Reduce Emissions and Deliver Benefits for Customers & Local Economies BROOKLYN, N.Y. and WALTHAM, Mass., May 23, 2024 /PRNewswire/ -- National Grid today announced plans to invest an estimated $75 billion* across the company's service territory in the UK and US over the next five years, with nearly half of the funding dedicated to US energy system improvements in Massachusetts and New York. This significant step up to approximately $35 billion* of investment repre ...
National Grid(NGG) - 2024 Q4 - Annual Report
2024-05-23 10:32
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20-F (Mark One) £ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR R ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended 31 March 2024 OR £ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR £ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of event r ...
National Grid(NGG) - 2024 Q4 - Annual Report
2024-05-23 10:02
Investment Plans and Financial Growth - National Grid announced a £60 billion investment plan over the next five years, nearly double the investment of the past five years, aiming for 10% annual group asset growth and 6-8% underlying EPS CAGR from a 2024/25 baseline[8] - Total cumulative capital investment over the five-year period from 2024/25 to 2028/29 is expected to be around £60 billion[29] - Group asset growth CAGR is projected to be around 10% from a FY24 baseline, driven by a strong balance sheet[29] - Underlying EPS CAGR is expected to be 6-8% from a 2024/25 baseline, adjusted for the Rights Issue[29] - The company expects to invest around £60 billion in energy networks and adjacent businesses over the next five years, with group assets projected to reach £100 billion by March 2029[120] - In the UK, the company plans to invest £23 billion in Electricity Transmission and £8 billion in Electricity Distribution over the next five years[121] - In the US, the company expects to invest £17 billion in New York and £11 billion in New England over the next five years, with 60% allocated to electricity networks[122] - The company anticipates a CAGR in underlying EPS of 6-8% from 2024/25 to 2028/29, with a total DPS of 58.52p/share for 2023/24[126][128] - Total Group capital investment for 2023/24 is expected to be around £10 billion, with Group Asset Growth projected at 10%[145] - Group expects capital investment of around £10 billion for continuing operations in 2024/25[194] Operational Performance and Profitability - The company reported a 6% increase in underlying operating profit and underlying EPS at constant currency, with a record investment of £8.2 billion across the Group[10] - The company's underlying operating profit for continuing operations was £4.8 billion, up 4% at actual exchange rates (6% at constant currency)[20] - National Grid's statutory operating profit for continuing operations decreased by 8% to £4.5 billion, with statutory EPS down 19% to 60.0p[20] - Underlying operating profit for continuing operations increased by 6% to £4,773 million in 2023/24[41] - Return on Equity (RoE) across the Group decreased by 210 basis points to 8.9% in 2023/24[44] - Adjusted earnings for 2023/24 were £3,100 million, up 33% from the prior year, including a timing over-recovery after tax of £688 million[154] - Underlying operating profit for continuing operations increased by 4%, driven by higher allowed revenues in UK Electricity Transmission and rate increases in KEDNY/KEDLI and NIMO[156] - Adjusted operating profit increased by £1,168 million (27%) or 29% on a constant currency basis, driven by improved performance in UK Electricity Transmission, New York, and New England[170] - Statutory operating profit decreased primarily due to exceptional net charges of £1,011 million, partly offset by favourable year-on-year movements in timing net over-recoveries and commodity derivative remeasurements[170] - Statutory IFRS earnings for 2023/24 were £2,216 million, down 18% from the previous year, impacted by £1,011 million in exceptional net charges[153] Capital Investment and Asset Growth - The company's capital investment for continuing operations increased by 8% to £8.2 billion, driven by early investment in UK Electricity Transmission and new transmission projects in New York[18] - Capital investment for continuing operations increased by 11% to a record £8,235 million in 2023/24[30] - UK Electricity Transmission capital investment increased by 47% to £1,912 million in 2023/24[30] - Renewable energy connected to the UK Transmission and Distribution Grids increased by 1,752% to 2,444 MW in 2024[31] - Total capital investment for continuing operations in 2023/24 was £8,235 million, an 8% increase (£642 million) at actual exchange rates and 11% at constant currency[194] - UK Electricity Transmission capital investment increased by 47% to £1,912 million in 2023/24 compared to £1,301 million in 2022/23[195] - New York capital investment rose by 8% to £2,654 million in 2023/24, with a 12% increase at constant currency[195] - National Grid Ventures (NGV) capital investment decreased by 32% to £662 million in 2023/24 due to largely completed projects in the prior year[195] - UK regulated asset base (RAV) increased by 7.3% in 2023/24, influenced by higher CPI inflation on RAV indexation[199] - US rate base grew by 11.5% in 2023/24, reflecting strong capital investment[199] - NGV and Other businesses increased assets due to ongoing capital investment, contributing to overall asset growth[199] - UK Gas Transmission capital investment in 2022/23 was £301 million, prior to the business disposal in January 2023[198] Renewable Energy and Environmental Initiatives - National Grid connected 3,030 MW of renewable energy across its UK and US transmission and distribution networks, an increase of 2,344 MW compared to the prior year[24] - The company achieved a 5.9% reduction in Scope 1 and 2 emissions versus 2022/23, and a 11.8% reduction against the 2018/19 baseline[24] - Renewable energy connected to the UK Transmission and Distribution Grids increased by 1,752% to 2,444 MW in 2024[31] - 3,030 MW of renewable energy connected across UK and US networks, with a 1.4 GW increase in interconnector capacity from Viking Link[106] - The company engaged with 50 carbon strategic suppliers in the UK and 74 in the US, accounting for over 30% of GHG emissions from purchased goods and services[109] Dividend and Shareholder Returns - The company's recommended final dividend is 39.12p, bringing the full-year dividend to 58.52p, up 5.55%[20] - The Board recommended a 5.55% increase in the final dividend to 39.12p per ordinary share, bringing the full-year dividend to 58.52p per ordinary share[188] Strategic Business Focus and Divestments - National Grid plans to sell Grain LNG and National Grid Renewables as part of its strategy to focus on networks, streamlining its business[11] - National Grid's asset base shifted to 75% electricity following the sale of a 20% stake in National Gas Transmission, up from 60% in March 2021[61] - The disposal of a further 20% interest in UK Gas Transmission generated £681 million in proceeds, contributing to the reduction in regulatory gearing[181][186] Infrastructure Projects and Upgrades - The Great Grid Upgrade plan aims to build more than five times the amount of new electricity transmission infrastructure in the next six years compared to the past 30 years[50] - National Grid's share of the £2.5 billion investment in the Eastern Green Link 1 (EGL1) project is £1.5 billion, with construction set to begin in 2025[52] - The Eastern Green Link 2 (EGL2) project involves a total investment of £4.4 billion, with National Grid contributing £2.4 billion, and will be the UK's longest HVDC cable[52] - National Grid selected seven supply chain partners for £4.5 billion worth of network infrastructure design and construction work through 2030[55] - The HVDC supply chain framework aims to secure over 14,000 kilometres of cabling with a provision for around £60 billion of investment[58] - National Grid plans to invest over $4 billion in the Upstate Upgrade project in New York, including over 1,000 miles of transmission line and 45 substations[62][63] - National Grid's share of the $2.8 billion Propel NY Energy transmission project is around $340 million[68] - The New York Energy Solution transmission line upgrade project involved a total investment of $670 million, with National Grid contributing around $100 million[69] - National Grid's Smart Path Connect project includes a $550 million investment to upgrade 55 miles of transmission circuits in Northern New York[67] - Smart Path Connect transmission project in New York to unlock over 1,000 MW of renewable resources, with a 10.3% RoE[92] - Proposed $2 billion investment over five years in Massachusetts under the Electric Sector Modernization Plan (ESMP)[93] Regulatory and Financial Metrics - Up to £58 billion investment into UK electricity transmission networks through the 2030s, with a 65% growth in Great Britain's electricity demand between 2023 and 2035[81] - Transmission connection queue in Great Britain stands at over 700 GW, significantly oversubscribed compared to ESO Future Energy Scenario requirements[83] - Introduction of 'Queue Management' clauses in connection agreements, potentially accelerating connection dates for up to 70 GW of projects[84] - Release of 10 GW of grid capacity for renewable generation assets on the UK Electricity Distribution network[85] - Removal of 95 projects totaling 2.25 GW from the distribution connection queue[86] - Proposed $924 million capital investment for KEDNY and $646 million for KEDLI in the first rate year, with a 9.35% RoE[90] - Underlying net revenue for UK Electricity Transmission is expected to increase by over £150 million in 2024/25, driven by higher allowances and indexation[132] - Underlying net revenue for New York is expected to increase by nearly $450 million in 2024/25, primarily due to proposed rate settlements[139] - Operating cash flow from continuing operations is expected to decrease by around 5% in 2024/25, primarily due to the reversal of ESO's timing over-recovery[146] - Net debt is expected to decrease by around £0.5 billion, driven by proceeds from the Rights Issue, with regulatory gearing reducing to the low 60% range[147] - Weighted average number of shares (WAV) is expected to increase by approximately 938 million to 4,688 million in 2024/25 due to the Rights Issue[148] - Timing over-recoveries in 2023/24 included £363 million in UK Electricity Transmission and £800 million in UK Electricity System Operator[165] - Deferrable storm costs in the US for 2023/24 were $285 million, eligible for future recovery under rate plans[166] - Underlying tax charge for the year was £515 million, with an underlying effective tax rate of 15.6%, 170bps lower than last year[174][175] - Cash flow generated from continuing operations was £7.3 billion, £0.8 billion higher than last year, primarily due to timing over-recoveries and higher revenues in UK Electricity Transmission and New York[178] - Net debt at the end of the year was £43.607 billion, a 6% increase from the previous year, with regulatory gearing reducing to 69%[176][186] - National Grid raised £5.6 billion of new long-term senior debt during the year to refinance maturing debt and fund its capital programme[184] - Retained cash flow as a proportion of adjusted net debt was 9.2%, with the Group maintaining strong investment grade credit ratings[187] - Group achieved asset growth of 9.7% in 2023/24, driven by capital investment and RAV indexation[193] Customer Support and Community Engagement - The company provided £11.3 million to UK partners and $1.8 million to US partners through the Energy Support Fund to assist customers affected by rising energy costs[111] - In Massachusetts, the company facilitated over $18 million in home energy assistance funding and enrolled more than 250,000 customers on income-based discount rates[112] - National Grid colleagues volunteered 77,918 hours in 2023/24, with a cumulative total of 179,480 hours since 2020, achieving 36% of the 500,000-hour target[113] Efficiency and Cost Management - £139 million of Group efficiency savings in 2023/24, exceeding the £400 million target by £113 million[101]
National Grid Opens Applications for DEI Engineering Scholarship and Internship Program
Prnewswire· 2024-04-24 13:00
The program reflects the company's commitment to workforce development and employment pathways for underrepresented talent WALTHAM, Mass. and BROOKLYN, N.Y., April 24, 2024 /PRNewswire/ -- National Grid today opened applications for its "Charging Our Future" Diversity, Equity, and Inclusion (DEI) Engineering Scholarship Program. The program supports students enrolled in undergraduate engineering programs with a strong interest in energy industry careers. Now in its third year, National Grid launched the sch ...