National Grid PLC (LSE:NG.) ticked higher as it forecast steady earnings growth over the next five years in spite of a big interim profits drop.
Underlying earnings should grow by between 6-8% in each year to 2029 said the electricity distributor which has earmarked £60 billion to improve grid connections for the new raft of renewables projects planned by the governments here and in the US.
John Pettigrew, chief executive, said: “We've been encouraged by policy and regulatory progress on both sides of the Atlantic.
“In the UK, we sold the Electricity System Operator (ESO) to the government, and Ofgem's publication of the sector-specific methodology decision marked the next step in the RIIO-T3 regulatory process.
“In the US, we have new rates for our downstate New York gas business, and for our Massachusetts Electric business, giving us greater visibility on investment plans.”
Profits in the half year to end September 2024 dropped 50 % to £684 million reflecting the performance of ESO before its sale said National Grid with some £479 million of prior year over-collections paid back and causing a huge swing in the numbers.
Adjusted interim earnings rose by 23% to £1.27 billion while revenues fell 6% to £7.96 billion.
For this year, National Grid is forecasting operating profits to rise by 10% but earnings to be flat due to dilution from the £7 billion rights issue in May to pay for its capital investment programme.
The shares were up 4.89p at 988.09p.