Utilities provider National Grid reported a six per cent fall in profits for the six months to 30 September today, partially attributed to storm-related costs and the cancellation of a new pipeline in Avonmouth.
Underlying operating profit was £1.3bn, down £83m from the same period last year and of which £4m was attributed to foreign exchange rates.
UK watchdog Ofgem lowered National Grid's spending allowance last year, hitting revenues that would have otherwise come from a gas transmission pipeline in the UK port in a loss valued at £56m. The firm's UK gas transmission business posted a 37 per cent loss in underlying operating profits as a result, falling to £91m.
National Grid referenced its ongoing cost efficiency and restructuring programme in the UK, which it said will generate £50m in savings next year, followed by at least £100m annually from 2020 to 2021 onwards.
It also said it intends to sell the remainder of its 39 per cent stake in US firm Cadent, which it anticipates will lead to proceeds of around £2bn. The deal is expected to be completed in June 2019, pending regulatory approval.
Elsewhere, the firm's property business delivered an operating profit of £38m as a result of London land sales in Wandsworth, Hornsey and Oxted. The latter two sites are in the process of being combined into a joint venture in Fulham, which received planning approval in October to build more than 1,800 new homes.
National Grid chief executive John Pettigrew said: "We have continued to make strong operational progress in the first six months whilst maintaining excellent levels of safety and reliability."
"In the UK, we are implementing a cost efficiency and restructuring programme to ensure that we continue to drive outperformance for customers and shareholders."
"Looking forward, National Grid is well positioned for the ongoing energy transition and we are on track to achieve asset growth at the top end of our 5-7% range in the medium term."