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DATE
Thu, Nov. 5, 2026
CALL PARTICIPANTS
- Chief Executive Officer – Zoë Yujnovich
- Chief Financial Officer – Andrew Agg
- Interim Director of Investor Relations – Andrew Downey
TAKEAWAYS
- Capital Investment — £6.7 billion, representing a 32% increase at constant currency driven by record spending in U.K. Electricity Transmission.
- Underlying EPS — 36.5p, growing 22% due to stronger operational performance and fair value gains in the National Grid Partners portfolio.
- FY 2027 EPS Guidance — 15% to 16% growth, upgraded from previous estimates reflecting execution momentum and one-off fair value gains.
- FY 2027 Capital Investment Guidance — £13.5 billion, reflecting a faster pace of supply chain delivery and project milestones.
- 5-Year Capital Investment Plan — £70 billion through fiscal year 2031, with 80% of supply chain and delivery mechanisms already secured.
- U.K. Electricity Transmission Operating Profit — £1.2 billion, up 45% primarily due to higher allowed revenues under the RIIO-T3 framework.
- U.K. Electricity Transmission Investment — £2.9 billion, a 71% increase at constant currency reflecting the step-up into the RIIO-T3 framework and ASTI project ramp-up.
- New York Capital Investment — £1.8 billion, increasing 11% behind electric transmission upgrades and gas maintenance programs.
- New England Capital Investment — £1.1 billion, rising 14% driven by asset condition and system capacity investments.
- Interim Dividend — 16.97p per share, a 3.8% increase in line with the company’s inflation-protected progressive policy.
- Net Debt — £48.6 billion, an increase of £4.5 billion from the prior period due to capital investment, interest, and the Joulent investment.
- Joulent Investment — $1.75 billion for a 35% interest, targeting contracted power solutions for large-load U.S. customers.
- Generation Connections — 2.5 gigawatts, more than doubling the generation connected in the entirety of fiscal year 2026.
- U.K. Electricity Distribution Operating Profit — £550 million, remaining broadly flat as indexation-driven revenue was offset by higher depreciation and maintenance costs.
- U.K. Electricity Distribution Investment — £834 million, growing 10% primarily due to increased asset health and connections investment.
- New York Operating Profit — £487 million, a 9% increase at constant currency driven by asset base growth and recovery of unremunerated costs.
- New England Operating Profit — £266 million, a 10% decrease as higher net revenues were offset by a one-off provision and increased depreciation.
- National Grid Partners Gains — £84 million, reflecting one-off fair value gains from successful capital market transactions, including the sale of Dragos and the ERock IPO.
- Operating Cash Flow — £4.1 billion, up 14% compared to the prior year driven by improved group cash generation.
- Net Finance Costs — £722 million, up 6% reflecting higher average net debt partially offset by increased capitalized interest.
- Staffing Growth — 3,600 new hires, with 90% recruited into operational businesses to support capital delivery programs.
- Statutory Revenue — £8.1 billion, representing a 15% increase driven by asset base growth and higher returns in U.K. Electricity Transmission.
- Interest Rate Exposure — 10% of net debt, representing the portion of the debt book sensitive to rate changes due to recovery mechanisms.
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RISKS
- Agg warned that in New England, higher net revenues were “more than offset by higher costs, including a one-off provision alongside higher depreciation and other investment-related costs,” which contributed to a 10% decline in underlying operating profit for the segment.
- Yujnovich noted that the “Middle East conflict [is] putting direct pressure on consumer energy bills,” identifying geopolitical tension as a factor impacting energy security and affordability.
SUMMARY
National Grid plc (NGG +0.82%) reported an acceleration in its capital delivery program and upgraded its annual earnings outlook. Management stated that the company is executing its largest-ever investment cycle, supported by the new RIIO-T3 framework in the U.K. and industrial demand in the U.S. The company has simplified its leadership structure and secured a significant portion of its long-term supply chain needs to mitigate global inflationary pressures and interest rate volatility.
- Chief Executive Officer Yujnovich stated, “Capital investment increased by 1/3 in the first half with important project milestones completed,” supporting upgraded guidance for the full year.
- The company established a 35% interest in Joulent, which is developing a 2.7 gigawatt co-located data center power facility in West Texas called Project Kilby.
- Management reported that the Micron semiconductor chip site in New York is expected to account for 2 gigawatts of demand at full build, equivalent to one-third of NiMo Electric’s current peak demand.
- The company achieved a 100-day schedule improvement on the Eastern Green Link 1 project by utilizing generative scheduling technology.
- Chief Financial Officer Agg noted that 75% of the company’s debt book is covered by operating company level recovery mechanisms, providing a partial hedge against rising interest rates.
- National Grid secured a development consent order for the Sea Link project, progressing the deployment of the multiyear ASTI portfolio.
INDUSTRY GLOSSARY
- ASTI: Accelerated Strategic Transmission Investment, a framework for fast-tracking major U.K. transmission projects.
- RIIO-T3: The U.K. regulatory price control for electricity transmission that runs from 2026 to 2031.
- ED3: The U.K. electricity distribution price control period scheduled to begin in 2028.
- NiMo: Niagara Mohawk, National Grid’s electric and gas distribution business serving Upstate New York.
- KEDNY/KEDLI: KeySpan Energy Delivery New York and KeySpan Energy Delivery Long Island, the company’s gas businesses in Downstate New York.
- NGP: National Grid Partners, the corporate venture capital and innovation arm of the company.
- RAV: Regulated Asset Value, the value of the assets upon which a regulated utility is permitted to earn a return.
- CPIH: A measure of consumer price inflation in the U.K. that includes owner occupiers’ housing costs.
- DCO: Development Consent Order, the primary planning permission required for major infrastructure projects in the U.K.
- AMI: Advanced Metering Infrastructure, integrated systems of smart meters and communication networks.
- Joulent: A strategic partnership focused on power solutions and high-voltage infrastructure for large-load U.S. customers.
Full Conference Call Transcript
Zoe Yuj
Source: www.fool.com — article syndicated from the publisher’s feed; all rights remain with the original publisher.
