National Grid Share Discussion Threads

[atlantic57] 20/3/2017 15:06

This looks like a good Company to be involved with on a three year view.
The exposure that ng have to the us Economy should benefit from Trump infra structure spend.

Also we should benefit from currency movement.

Finally here in the uk we have a stable market at the time of penning these comments.

[utyinv] 20/3/2017 11:28

una,

You don't get something for nothing.

With the sale of 61% of the Distn Gas business the company will be that much smaller with revenue adjusted accordingly.

As my previous post, there hasn't been a decisive strategy by the 'Board' but based on what we know and without re-typing the cals:

£3 billion will be returned to shareholders via a special divi.

Approx 3.7 billion shares in Circ.

£1 Billion will be used to buy back shares reducing the shares in circ . The reduction all depends on what price NG pay for the shares to be cancelled. If they do it too hastely they may get a poor price (too high).

There then leaves a deficit, £1 Billion buy back does not replace £4.6 Billion. The difference has to be accounted by either a share consolidation or a reduction in share dividend or a mixture of both because even after the share buy back (looking at the worth of the business being sold off and what revenue it brings in - E/S) the reduction equates to approximately 6%.

Many Companies that have issued special dividends due to a sale of part of the business have accompanied the payment with a share consolidation. The special dividend is not excess profits or cash the Company has found (the regulator is not a friend of the Utility), it (NG) is selling part of the company you as a shareholder own and they are giving you back cash for that part of the business.

The saving grace is that NG have decided to sell the majority stake in the gas Distribution because if you look at the last full year results the returns in this costly, highly regulated business is not that great and the Company believe they can achieve greater returns for shareholders by concentrating on other parts of the business, i.e. USA. So in time the income from the shares should continue to provide greater returns to investors. OFGEM (regulator) needs to appreciate that NG is not a charity!

We have to be patient to find out the finer details on completion of the sale; when the special divi is to be paid, how much share buy back has been achieved from the proceeds of the sale and if there is a share consolidation and / or a new dividend strategy. It's all guess work at the moment but according to reiterated publications the sale will be completed on or before the 31st March, so not long to wait!

[unastubbs] 18/3/2017 22:59

hi UtyINV5 re. yr post 4449 abt the possible reduction in the dividend following the divestment, are these your own musings or have you seen any references to such a proposal? I have held vod and gsk who have paid share price divs in recent years following similar sales of assets and neither of them reduced the subsequent dividend. I wd be surprised and disappointed if it did happen - and i think the market wd be as well, since it's not been mentioned before (afaik) - cheers - una

[bountyhunter] 16/3/2017 17:55

Some late news - so late in the day for an RNS that I nearly missed it!

"16 March 2017 4:48pm

National Grid Gas Distribution - European Commission Merger Clearance

National Grid plc is pleased to announce that the European Commission has cleared the sale of a 61% equity interest in its UK gas distribution business to a consortium (the "Consortium") of long-term infrastructure investors.

The Consortium comprises Macquarie Infrastructure and Real Assets, Allianz Capital Partners, Hermes Investment Management, CIC Capital Corporation, Qatar Investment Authority, Dalmore Capital and Amber Infrastructure Limited/International Public Partnerships.

National Grid expects that the transaction will complete on 31 March 2017."

[santangello] 14/3/2017 13:08

Many thanks Dave, I should have known that lol.

[daveofdevon] 14/3/2017 03:34

It might be an idea if you searched LSE TRADE TYPES then you would know that this is nothing to get excited about. The 1.4m trade at 4:35 was flagged as UT and is an end of day uncrossing trade to clear down SETS so not a buy or a sell really.

[santangello] 13/3/2017 23:02

Agreed, but positive nonetheless...

[atlantic57] 13/3/2017 22:51

Surely a 1.4 million buy would be small beer for the size of company that ng is.

[santangello] 13/3/2017 22:39

1.4m buy and no RNS.....?? Doubt it would be MM to MM....interesting....

[utyinv] 10/3/2017 17:23

A lot of our stock appears to have taken a dive since the Yanks opened! The ftse is only up because of the Oilers and BT!

[bountyhunter] 08/3/2017 15:43

picks up on US buying from when the Dow opens?
too pessimistic over here (or too optimistic over there!)
the ftse followed the same pattern today but maybe that's as no nasty shocks in the budget and growth forcasts upgraded?

[davr0s] 08/3/2017 14:30

Every day seems to follow the same routine at the moment - drop1-2% and then regain it in the afternoon. Goodness knows what it means

[bountyhunter] 05/3/2017 19:15

as the sale of 61% of the UK Gas Distribution Unit is due to complete by 31-Mar-2017 I've added brief details at the end of the header for reference

there is also now a small DOW index chart towards the top of the header to complement the FTSE chart

[bountyhunter] 05/3/2017 17:17

yes sounds quite plausible, and a share consolidation could possibly be on the cards to keep future dividends in line; I hadn't considered that

[utyinv] 05/3/2017 16:27

Bounty,

My Guess is that the payout will be May (just before the Final results so they can do the PR bit quoting the return of cash to shareholders).

I expect ex divi for special divi will be mid April? Either way, I will be interested in the Final results and the intended Final Divi in Aug and how much less that Final divi will be due to the reduction in size of business. If there isn't a share consolidation even with buy-back, I would expect a 4% reduction from 26.8p to 25.74p. 6% total reduction in divi, with 2/3 of 6% for Final and 1/3 for Interim if you know what I mean?

[bountyhunter] 05/3/2017 10:36

Uty, yes pretty close so should be around that, although could be a little lower depending on the amount put aside for buybacks

I got the current market cap from the advfn financials ( ), also shown in the header, which fluctuates from day to day so I allowed for that by including the share price taken at the same time as the market cap in my calculation

The other question is when exactly will it be paid, they have indicated Q2 of 2017 but so I wonder if that means that they could make the xd date the same as for the final dividend xd which is 1 June, although the final div payment date is not until 16 Aug which is Q3 of the calendar year

[utyinv] 05/3/2017 00:00

bounty,

shares in circ 3.7 billion so mkt cap = 3.7 x £9.76 = £36.112 billion.

£4b x 0.75 / 36.112 = 8.3%

£9.76 x 8.3 / 100 = ~ 81p per share. Diff in my calc and yours is shares in circ and market cap. I believe, but stand corrected, that there are 3.7 billion shares in circ.

So 78p or 81p we are in the same ball park. :)

[bountyhunter] 04/3/2017 17:57

so £(4b * 0.75 / 36.7b (current market cap)) * 100 =~ 8% return excluding buybacks

therefore according to my calculations the maximum return excluding buybacks
= 976p (current share price) * 8/100 =~ 78p per share

[bountyhunter] 04/3/2017 17:48

just a reminder from the announcement in December:

"Following completion of the Transaction, National Grid intends to return £4 billion of net proceeds to shareholders through the combination of a special dividend (together with a share consolidation) and share buy-backs. At least 75% of the net proceeds are expected to be returned via a special dividend in Q2 of calendar year 2017. Net proceeds are calculated after retaining £0.7 billion of the additional debt financing, in order to maintain the equity value of our 39% interest in NGGD, and after deduction of costs of around £0.5 billion. A further announcement regarding the nature and timing of the capital return will be made in due course.
Completion of the Transaction is conditional on the receipt of merger clearance from the European Commission. Subject to satisfaction of this condition, National Grid expects that the Transaction will complete on or prior to 31 March 2017."

...so the European Commission is due to clear this just as we invoke article 50 :-)

[neddo] 04/3/2017 11:50

thanks uty, would that be march/ april this year or next?

[bountyhunter] 02/3/2017 21:21

not announced yet and neither is the exact amount (as some to be used for buybacks)

[poleaxe] 02/3/2017 20:58

When is the xd on the special divi, afraid i have not been following this that closely.

[mike24] 02/3/2017 16:20

come on, back to £10.50
no comments on "Deepminds" algorithms to enhance NG performance?
sun/times