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8 | 13TH - 19TH NOVEMBER 2015 | UTILITY WEEK National Grid special report stuff is very small, and is concentrated in National Grid." Nevertheless, Pettigrew will need to be alive to the debate. He will also be mindful of the drive towards greater com- petition in areas of the company's business, and the culture change this would entail. Though best known in the UK for its transmission role, National Grid is a diverse organisation, with its US operations making up a sizeable chunk of its portfolio. There have been ongoing concerns about the com- pany's performance in the US, particularly from the financial markets (see Nigel Hawk- ins' column on p7). While industry sources consider a disposal unlikely, Pettigrew will be looking to transform the fortunes of the US operations. Meanwhile, acquisitions elsewhere are not out of the question. One industry source observed: "National Grid has decided to position itself as a developed economy utility player focusing on the US and UK markets – it has a look at other mar- kets from time to time." Pettigrew will not be able to meet these challenges alone – his senior team will be crucial. There have been some high profile exits from the company in recent years, most notably Nick Winser last year. Questions have also been raised over whether Andrew Bonfield, the respected finance director, will stick around, although he told Utility Week this week that he would. Getting – or keep- ing – the right people around him will be critical to Pettigrew's leadership – particu- larly given his background as an economist rather than an engineer. While challenges abound, National Grid remains the great success story of energy pri- vatisation. The trick for Pettigrew will be to build on this track record, maintaining sta- bility as the landscape around the company changes beyond recognition. SHARE PRICE HISTORY In the lead-up to 2008, the market was generally strong. The collapse of Lehmans in late 2008 signalled the start of the banking/credit crisis and the subsequent recession. In the UK, massive bailouts were needed for RBS and Lloyds. Dorothy Thompson, chief executive of biomass generator Drax Grid H1 results "Following a sale of our GDNs, National Grid's portfolio will have a higher asset growth profile and will remain well positioned to deliver strong returns and a sustainable, growing dividend." "Headline profits have benefited from an excellent performance from our interconnectors and property activities.' Steve Holliday, National Grid chief executive £610m UK electricity transmission operating profit £159m UK gas transmission operating profit +22% Adjusted earnings per share is 28.4 pence +17% Investment was £1.9bn over the six months 14% 2015 H1 operating profit hits £1,836m £428m UK gas distribution operating profit £351m US regulated business operating profit 1000 900 800 700 600 500 400 Once the recession kicked in, National Grid offered good defensive character- istics for investors: solid earnings and dividends. And, unlike generators, it was far less exposed to fluctuating prices in UK and EU electricity markets. From about 2012 onwards investors increasingly realised that the eight-year regulatory deal with Ofgem was very positive – and provided healthy earnings until 2021. The contrast with some energy suppliers whose shares have dropped alarmingly, is stark. 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Business review UK • Under RIIO, continued focus on efficiencies and developing innovative solutions • Delivering strong operational performance and continuing to deliver savings through regulatory totex allowances Business review US • Reduced controllable costs while delivering the planned step-up of investment, par- ticularly the replacement of old gas mains • On track for another year of record invest- ment • Submitted full updated rate plan for Mas- sachusetts Electric business ➟