National Grid 2008 Annual Report Download - page 586

BOWNE INTEGRATED TYPESETTING SYSTEM
CRC: 1588
Name: NATIONAL GRID
Date: 17-JUN-2008 03:10:51.35Operator: BNY99999TPhone: [phone]Site: BOWNE OF NEW YORK
Y59930.SUB, DocName: EX-15.1, Doc: 16, Page: 64
Description: EXHIBIT 15.1
0/1260.00.00.00Y59930BNY
[E/O] EDGAR 2 *Y59930/260/1*
BOWNE INTEGRATED TYPESETTING SYSTEM
CRC: 1588
Name: NATIONAL GRID
Date: 17-JUN-2008 03:10:51.35Operator: BNY99999TPhone: [phone]Site: BOWNE OF NEW YORK
Y59930.SUB, DocName: EX-15.1, Doc: 16, Page: 64 Description: EXHIBIT 15.1
0/1260.00.00.00Y59930BNY
[E/O] EDGAR 2 *Y59930/260/1*
Table of Contents
72
Non-re
g
ulated businesses and other continued
National Grid plc
£104m £93m £12m £(2)m
Metering adjusted
operating profit
UK Property adjusted
operating profit
Grain LNG adjusted
operating profit
US non-regulated
businesses adjusted
o
p
eratin
g
loss
Exceptional items of £57 million in 2007/08 includes
£44 million arising from an increase in the provision for
environmental remediation of historically contaminated sites
in the UK following a review conducted during the year,
£15 million relating to costs incurred with respect to the
potential disposal of the UK property business and £4 million
of restructuring costs, partially offset by a £6 million gain on
the disposal of Advantica. This compared with £1 million in
exceptional items in 2006/07.
As a consequence, adjusted operating profit excluding
exceptional items, for other activities decreased by £4 million
and operating profit decreased by £60 million.
2006/07 compared with 2005/06
The principal movements between 2006/07 and 2005/06 can
be summarised as follows:
Revenue and other operating income from non-regulated
businesses and other operations reduced from £775 million
in 2005/06 to £638 million in 2006/07. The principal reason
for this fall was £134 million lower revenue at Fulcrum,
reflectin
g
the full year impact of the loss of business from the
four regional gas distribution networks disposed of in
2005/06. Revenue and other operating income was
£20 million lower in our property business, reflecting the
impact of the revised planning guidance for development of
sites in close proximity to hazardous installations issued by
the HSE. Partially offsetting these reductions, revenue was
£19 million higher in our metering businesses, reflecting
growth in OnStream, and revenue and other operating
income at Grain LNG was £11 million higher, reflecting the
first full year of Phase I operations.
Operating costs excluding exceptional items were
£120 million lower in 2006/07 compared with 2005/06. Within
Fulcrum, operating costs were £125 million lower as a result
of the loss of business from the disposed gas networks.
Revenue
and other
operating Operating Operating
income costs profit
£m £m £m
2005/06 results 775
(
607
)
168
Add back exce
p
tional items
–
(
18
)
(
18
)
2005/06 ad
j
usted results 775
(
625
)
150
Meterin
g
19
(
13
)
6
Pro
p
ert
y
(
20
)
18
(
2
)
Grain LNG 11 (8) 3
Fulcrum
(
134
)
125
(
9
)
Insurance and other
(
13
)
(
2
)
(
15
)
2006/07 ad
j
usted results 638
(
505
)
133
2006/07 exce
p
tional items
–
(
1
)
(
1
)
2006/07 results 638 (506) 132
Operating costs were also £18 million lower in our property
business due to the expected reduction in stock sales. These
decreases were partially offset by operatin
g
cost increases in
our metering and Grain LNG businesses of £13 million and
£8 million respectively as a result of the increased volumes
in these businesses.
Contributions from non-regulated businesses to the adjusted
operating profit for other activities comprised £103 million in
2006/07 from Metering, £86 million from Property, £9 million
from Grain LNG and £2 million from Advantica (2005/06:
£97 million, £88 million, £6 million and £1 million loss
respectively).
The exceptional item of £1 million in 2006/07 related to the
non-regulated businesses and other operations’ share of
restructuring costs incurred during the year. This compared
with a net £18 million gain in 2005/06. As a consequence,
adjusted operating profit excluding exceptional items
reduced by £17 million and operating profit reduced by £36
million.