Energy company National Grid has announced it has increased its full year dividend pay-out by 2.6% to equal 48.57p per share.
Revealing its full-year results for the period ended 31st March 2020, SSE revealed a slight fall of 3% in operating profit to £2.8bn as COVID-19 took a toll on its earnings.
It set aside £117m in anticipation of US bad debts.
Looking to FY21, it anticipates the impact of COVID-19 to make a bigger dent in its earnings – an approximate £400m dent on underlying operating profit to be precise.
Despite the set backs, National Grid confirmed it will stick with its policy of growing dividends at least in sync with RPI inflation for the ‘foreseeable future’.
Reassuring investors over the ability for the dividend to be maintained, CEO John Pettigrew noted he expects that the financial impairments caused by COVID-19 will be ‘largely recoverable’ in future years:
“National Grid made good progress in 2019/20. We maintained high levels of reliability across our networks and delivered good financial performance. Asset growth of 9% was underpinned by record investment of £5.4 billion. We achieved continued regulatory progress in the UK, responded proactively to the challenges in downstate New York, whilst further developing our interconnector and renewable portfolios.
Looking ahead, whilst COVID-19 will impact our financial performance in FY21, we expect this to be largely recoverable over future years and therefore anticipate no material economic impact on the Group in the long-term. We continue to target asset growth of 5-7% in the near term and with an efficient balance sheet that underpins asset and dividend growth, the Group is well positioned to create value for shareholders.”