FTSE 100-listed electricity and gas group National Grid has unveiled a new dividend policy which is to apply from April 1st 2013.
The group said that the new policy would aim to grow the ordinary dividend at least in line with the rate of RPI (Retail Price Index) inflation each year for the foreseeable future.
Under the new policy, from the financial year ending March 2014, and for the foreseeable future, full-year dividend growth would be not less than the increase in average RPI for the 12 months to March.
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For the year ending March 2014 the interim dividend is expected to be 14.49p, thereafter the group said that it is intended that the interim dividend be determined as 35% of the previous year's full-year dividend. National Grid said that it expects to continue to offer a scrip dividend option.
The final dividend relating to the year 2012/13 is expected to be paid in August 2013 and the board expects it to reflect the existing 4% growth policy.
Commenting on the new policy Steve Holliday, Chief Executive Officer of National Grid said: "I am pleased to confirm a new dividend policy which supports our long term ambition to target a secure dividend in real terms for our shareholders while enabling the group to sustain the strong balance sheet needed to fund the business."
Trading update: earnings forecast ahead of previous expectationThe group reported that 2012/13 was "finishing well", with earnings forecasted to be modestly ahead of National Grid's previous expectations.
In comparison to previous guidance, the group said that a strong UK Transmission business performance and lower net finance costs, now expected to be in line with last year despite increased net debt, should be broadly offset by additional expenses related to February's US storm restoration work and continued system implementation costs.
It added that earnings were expected to further benefit from a lower effective tax rate, in part as a result of a change in profit mix.
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