The shares of National Grid (LSE: NG) (NYSE: NGG.US) remained flat this morning, having closed yesterday at 778p. This is after the energy provider reported strong network performance across all businesses in a trading update.
Capital investment of around £3.5 billion is expected to be maintained for the coming year and drive growth.
In the UK, recent investment in flood defences have helped minimise any impacts on cost or reliability during bad weather.
However, an ice storm in the US resulted in around 150,000 National Grid customers being temporarily without power, but compared to the previous two years, disruption and costs from bad weather have decreased. In total, major storms cut profits by £136 million.
Steve Holliday, the chief executive, had the following to say:
“Our businesses made further progress through to the end of January toward achieving our priorities for the year. We are investing in our networks for the benefit of customers and maintaining a strong focus on efficiency and incentive performance.
“Our networks performed well, demonstrating strong resilience during some difficult weather conditions in both the US and UK. I believe that this shows the benefits of our investment in process development and infrastructure and the continued dedication of our front line colleagues.
“We reconfirm our positive outlook for 2013/14 – overall, we are well positioned to deliver another year of good operating performance and sustainable dividend growth.”
Prior to today, City experts were expecting National Grid’s upcoming annual results to show earnings per share of 54p per share. The shares may therefore trade on a P/E of 14.
The decision to ‘buy’, based on those ratings, today’s results and the wider prospects for the energy sector, is solely your decision.
