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Good morning and welcome to National Grid's full year results presentation. I'm Angela Broad, Head of Investor Relations, and it's great to have so many of you on the call today. I'd like to draw your attention to the cautionary statement at the front of the pack. As usual, a Q&A with John and Andy will follow the presentation. Please join via the conference call to ask a question or use the tab at the bottom of the webcast to submit a written question. All of today's materials are available on our website. And of course, for any further queries after the call, please do feel free to reach out to me or one of the IR team. So with that, I'd now like to hand you over to our CEO, John Pettigrew. John.

Many thanks, Angela. Good morning, everyone. Thank you for joining us to discuss our full year results. I hope to see many of you later today at our Building Our Energy Future event for a deep dive on major capital projects we're delivering across the UK and the Northeast US. As ever, I'm here with Andy Ag, and once we've been through our respective presentations, we'll be happy to answer your questions. Last May, we announced a refined strategy focused on peer play networks. We also set out a new five-year financial framework on our plans for 60 billion pounds of capital investment. This will drive asset growth around 10% per annum and underlying earnings per share growth of 6% to 8% whilst maintaining a strong balance sheet and delivering an inflation-protected dividend. Alongside this, we set out our comprehensive financing strategy, including our 7 billion pounds equity raise, providing clarity over our funding to at least 2031. In the first year of the five-year framework, we've accomplished a huge amount despite a turbulent economic and geopolitical environment. We've delivered record capital investments of 9.8 billion pounds in line with our plan and 20% higher than last year. This reflects the scale of the activity across all of our regulated businesses, including significant progress within our ASSITY portfolio where all six of our Wave 1 projects are now under construction. A step up in asset health and network reinforcement in electricity distribution, over 350 miles of gas and engine replacement across Massachusetts and New York, and good progress with our SmartPath Connect project in US electricity transmission. We've also secured the supply chain and delivery mechanisms for more than two-thirds of our 60 billion pounds of capital investment. For ASSITY, this includes contracts for the delivery of 12 on shore and two offshore projects while also making good progress on Eastern Greenlinks 3 and 4 and Sealink. And in New York, we've made further progress with our $4 billion upstate upgrade awarding contracts for the first phase as well as the engineering works for phase two. The policy and regulatory agenda of both sides of the Atlantic has also continued to move forward, further enhancing visibility on our investment plan. In the UK, the government published its Clean Power Action Plan in December and OFGEM published its decision on connections reform last month which embeds is it ready and is it needed criteria into the connections process. This will deliver a rationalized queue of projects aligned with the Clean Power Plan and clarify the specific investments and locations required in the outer years of T3. New legislation on planning reforms was also introduced in March which aims to reduce the time it takes to deliver infrastructure projects. Whilst the reforms will be more impactful in the 2030s, there are important measures in the In the US, we refreshed all three of our New York rate plans and agreed new rates for our electricity distribution business in Massachusetts over the last year. Altogether, this means that we've now agreed over 70% of our US investment with regulators over our five-year frame. We also expect to receive approval for our electricity sector modernization plan in Massachusetts where we file for up to $2 million of capital investment over the next five years to help deliver the state's clean energy policy. So the combination of these firm foundations of our resilient business model which provides strong regulatory protections from macroeconomic uncertainty and no significant exposure to energy prices or merchant risk means that we're very well positioned and hugely confident in our ability to deliver our £60 billion investment program. We'll have much more to share on capital delivery at our investor event this afternoon where we'll showcase the sheer scale of our electricity transmission projects and how we've transformed the way we're delivering them. So turning now to some of the key highlights for the year. We've delivered a strong performance with underlying operating profit increased 12% to £5.4 billion at constant currency. This reflects robust operational performance as a result of increased regulated revenues and flat controllable costs achieved through our focus on agreeing the right regulatory frameworks and efficient delivery. Underlying earnings per share was slightly ahead of guidance at 73.3 pence and up 2% reflecting the impact of a higher share count following the rights issue. A record £9.8 billion of capital investment helped to drive regulated asset growth of 10.5%. And in accordance with our policy to grow the dividend in line with the UK CPI-H the board has declared a final dividend of 30.88 pence per share. This takes the total dividend for the year to 46.72 pence an increase of .21% on last year's rebased dividend. Moving next to reliability and safety. Reliability has remained strong across our UK and US networks despite severe weather events across our jurisdictions. An example of this is Storm Chyra last December, a once in a decade storm that hit our UK electricity distribution networks causing significant damage across the south west, south Wales and west Midlands. Our teams were tirelessly around the clock restoring power to 95% of customers within 48 hours. Last week the NISO published its interim report investigating the outage following the fire at our North Hyde substation in March. We welcome the report which establishes a timeline and sequence of events and outlines further steps required to deliver the final report in June. On safety our lost time injury frequency rate was 0.1 in line with our group target. As our workload increases we continue to invest heavily in attracting developing and retaining a qualified and competent workforce with robust training programs built around a culture of safety. We've also set protocols for our contractors so that high safety standards are maintained right across the workforce. Turning to our operating performance across the group starting with UK electricity transmission. Investment increased by 57% to £3 billion reflecting the ramp up in the first wave of six ASTI projects, major substation upgrades and a further four gigawatts of generation being connected to the network. This included the UK's largest battery storage unit at Lakeside in North Yorkshire and a 1.2 gigawatt offshore wind farm in Dogger Bank. The business delivered a return on equity of .3% outperforming its allowed return by 100 basis points. Turning to regulatory developments in December we submitted our £35 billion Rio T3 business plan representing the most significant investment in the UK's electricity transmission network in a generation. This ambitious plan will nearly double the power that can flow across the country directly connecting 35 gigawatts of generation and 19 gigawatts of demand and create optionality for a further 26 gigawatts all whilst maintaining world-class levels of reliability. Our submission also included clear evidence of the need for an investable financial framework including a real .3% allowed cost of equity, appropriate levels of cash generation and incentive mechanisms that will deliver benefits to both networks and consumers. Under our proposals we expect our investment plans to avoid constraint costs around £12 billion over the price control period offsetting the impact of investment to customer bills. In addition we're also pleased to see options decision on the advanced procurement mechanism. This will provide funding for transmission owners to secure supply chain capacity covering items like switchgear and transformers. This builds on the approach often adopted under the ASPE regime and we plan to utilise the framework from the middle of this year. Finally on policy developments in addition to the connections reform I mentioned earlier the government published its planning and infrastructure bill. The bill includes a number of proposals that are important to us including given certain projects the flexibility to choose the type of consenting regime used and providing opportunities to accelerate the consenting process. The bill also includes proposals intended to increase public acceptability of electricity transmission projects alongside guidance for wider community benefits. Moving to strategic infrastructure this will get a lot of focus this afternoon but to summarise we now have the great grid partnership up and running, the HPDC framework agreement in place, the supply chain secured for all 12 onshore projects, all wave one projects under construction and we've continued to build our internal capabilities and the workforce now stands at over a thousand employees. So in the last year we put the platform in place and delivery is well underway. Carl and his team will provide a lot more detail on our progress later today. Turning to UK altruistic distribution capital investment increased by 14% to 1.4 billion pounds driven by increased spending on asset health, network reinforcement and connecting nearly 600 megawatts of renewable generation. The business achieved a return on equity of .9% and whilst this reflects the benefit of our synergy savings programme it was heavily impacted by cost from storm Dara as well as lower than anticipated allowances from off-chim's real price effects mechanism that haven't matched what we were expecting when the price control was agreed. We're working hard to address the ongoing headwind and expect performance to improve over the remainder of the price control period. This year we also made good progress in developing our role as the distribution system operator or DSO including our leading role in the development of flexibility markets. We now operate the largest market across all DSOs allowing us to avoid over 200 gigawatt hours of renewable generation curtailment lowering costs for consumers. On the regulatory front off-chim published the ED3 framework decision at the end of April which gives us an early indication of their thinking on the next price control period and is the starting point for the development of the sector specific methodology. And as I mentioned earlier we were pleased to see off-chim's decision on connections reform. Electricity distribution has been playing a leading role in driving forward these reforms and over the last year we've been able to implement the industry's technical limits initiative accelerating the connection office dates on around three gigawatts of distributed generation and removed over four gigawatts of capacity from connections queues. Turning to the US our investment in New York increased by 24% to 3.3 billion pounds. This reflects a further 218 miles of gas mains replacement and a continued ramp up in our 4 billion dollar upstate upgrade program including the reinforcement and upgrade works as part of CLCPA phase one and continued strong progress on Smart Path Connect where we're rebuilding over 100 miles of transmission lines to connect large-scale renewable generation. Again we'll have much more to say on our upstate upgrade program this afternoon. We achieved a return on equity of 8.7 percent, 94 percent of allowed and 20 basis points higher than the prior year reflecting strong performance in our downstate gas businesses in the first year of our new rate plans. On the regulatory front we reached a joint proposal in April on new rates for Niagara Moorhook business which includes an improved return on equity of 9.5 percent, increased capex around 50 percent over the three years reflecting our step up in electricity transmission investment and funding to modernize our electric and gas networks and support New York's clean energy goals. The joint proposal also includes provisions to mitigate bill impacts for customers by spreading increases over the three years of the plan and putting in place assistance programs for low-income households. In New England capital investment increased by 5 percent to 1.8 billion pounds reflecting continued gas means replacement and increased asset condition and grid modernization work across our electric network. Our achieved return on equity was 9.1 percent, 92 percent of allowed benefiting from six months of the new rate agreements in our Massachusetts electric business. We've also seen a greater focus on affordability in the state following increased from a colder winter. To assist Massachusetts gas customers we agreed with the regulator to reduce winter gas bills by 10 percent during March and April with a deferral to be recovered over the summer. On the regulatory front in September the DPU issued its rate case order for our Massachusetts electric business approving a five-year plan with an allowed return of 9.35 percent. The order includes a new regulatory recovery mechanism that provides timely funding for growing capital investment, an updated performance-based rate mechanism providing inflation protection for operating and maintenance cost and increased allowances to cover the increasing cost of storms. Taken together these enhanced recovery mechanisms are helping us to earn closer to your allowed return. And as I mentioned earlier the DPU has also approved our electricity sector modernization plan for anticipatory investments to support the decarbonization of our networks. And from a policy perspective last month we submitted our climate compliance plan setting up a strategy to enable our Massachusetts gas network to advance state decarbonization goals whilst maintaining safe, reliable and cost-effective service for our customers. And finally last November governor Healy approved legislation that reforms the permitting process for utility infrastructure. This new approach sets maximum time frames for approvals capital projects in the state. And finally in National Grid Ventures capital investment was 43 percent lower at 378 million pounds following completion of the Viking link to Denmark last year. During the year we've seen good operation performance across the National Grid Ventures portfolio including good availability from our interconnector fleet, high levels of availability and utilization at our Long Island generation business and at our Grain LNG terminal where we're making good progress on the construction of the new tank. On the regulatory front last month OFTEM published their decision on the regulatory framework for offshore hybrid assets an important next step as we continue to develop our Line Link project as a next generation interconnector. So as I said at the start we've achieved significant progress across all areas of the business in the last year as we continue to efficiently deliver safe, secure and clean networks for the future. Let me stop there and hand over to Andy to walk you through the numbers before I come back and talk about priorities for the coming year. Andy.

Thank you John and good morning everyone. I'd like to highlight this as usual we're presenting our results on an underlying basis and at constant currency. I want to start by expanding on what John has said about National Grid's financial resilience. The visibility that our business model provides and the stability it gives is unwavering, however volatile the macro environment including times such as now. A large part of that can be attributed to our regulatory frameworks but it is also a consequence of our efficient delivery with controllable costs broadly flat this year and our robust procurement and financing strategies. Together these enable us to manage the impacts of inflation and cost pressures, changing interest rates and fluctuations in exchange rates and importantly that enables us to deliver stable and predictable growth through our significant capital program. Many of you will also know that we have substantial inflation and cost protections particularly in our UK regulated businesses with indexation of our regulated asset base. In the US around 90 percent of our supply chain is domestically sourced and even if higher costs do come through we can manage this through alternative suppliers or the pace of discretionary spend with any additional spend ultimately being picked up in the following rate case. We're also positioned so that the impact of exchange rate volatility from our US businesses is limited. We consistently hedge around 70 percent of our US gross assets with dollar denominated debt. This means from an earnings perspective our general rule of thumb is that for every five cent move in the average US dollar to sterling exchange rate we only expect to see one pence impact on EPS on an annualized basis. Finally from a financing perspective our regulated operating businesses broadly match leverage to our regulatory frameworks which enables us to efficiently recover debt costs. We also hold around 30 percent of our debt book at the hold co-level with the maturities out to the 2030s and any higher expected interest costs refinancing have been factored into our five-year financial frame. We've also set out our comprehensive financing plan which sees us fully funded until at least the end of Rio T3. So as I say all of these things add up to create a very stable platform from which to operate and deliver on our plans. Now let me take you through our financial performance. I'm pleased to be reporting a strong start to our five-year plan. Underlying operating profits on a continuing basis increased by £589 million to £5.4 billion up 12 percent on the prior year. This was mainly driven by strong performance across our regulated businesses including higher revenues and strong cost efficiency partly offset by expected lower revenues from our interconnectors. Higher operating profit combined with lower finance costs has led to an underlying earnings per share increase of 2 percent to 73.3p per share slightly above guidance and including the impact of a higher share count following the rights issue. Group return on equity was 9 percent supported by the growth in our regulated earnings offset by a higher denominator reflecting the rights issue. In line with our policy the board has recommended a final dividend of 30.88 pence taking the full year dividend to 46.72 pence per share representing a 3.2 percent increase compared to the prior year rebased dividend and in line with average CPIH inflation. As John said we've continued to deliver record levels of investment with capital investment from continuing operations increasing 20 percent to £9.85 billion helping drive regulated asset growth of 10.5 percent. Now turning to our business segments and starting with UK electricity transmission where underlying operating profit was £1.4 billion pounds 9 percent higher than last year. This was helped by increased totx allowances indexation and higher allowed returns partly offset by increased depreciation reflecting growth in asset base. Capital investment of £3 billion was up 57 percent versus the prior year. This included the ramp up of our wave one asty project spend including eastern green links one and two as well as the four onshore projects and construction activities on new customer connections partly offset by lower spend on london power tunnels two and the Hinkley connection. We've achieved an 8.3 percent return on equity delivering outperformance of 100 basis points and we remain on track to achieve 100 basis points of average annual outperformance throughout Rio T2. We also saw underlying operating profit of £115 million pounds from our electricity system operator over the first half of the year prior to its sale to the UK government. Moving to UK electricity distribution underlying operating profit was £1.2 billion pounds 51 million pounds higher than the prior year reflecting an increase in revenues from indexation partly offset by higher depreciation and one-off costs and incentive revenue impacts following the severity of storm darrah. Capital investment was £1.4 billion pounds 14 percent higher than last year with increased investment in asset replacement and reinforcement work. We are on track to deliver our £100 million pounds group synergies target by 2026 having achieved £88 million pounds as of the end of this year from areas such as procurement and operations. We achieved an ROE of 7.9 percent in the year outperforming our allowance by 20 basis points which is lower than our aim to achieve 100 to 125 basis points of outperformance. This reflects the one-off impacts from storm darrah and an impact arising from the real price effects or RPE mechanism where lower than anticipated allowances due to reductions in commodity indices since the start of the Rio ED2 period have not tracked actual costs incurred. We're working hard to mitigate this headwind and expect to improve in-year outperformance towards 100 basis points by the end of ED2. Moving now to the US, our New York business achieved an 8.7 percent return on equity 94 percent of its allowance and 20 basis points higher than last year. Underlying operating profit was £1.45 billion pounds 43 percent higher than the prior year. This reflects rate increases in our downstate gas businesses and cost efficiencies enabling us to broadly flat controllable costs partly offset by higher depreciation on our increased asset base. Capital investment was £3.3 billion pounds 24 percent up on the prior year. This was driven by higher electric investment including our Upstate Upgrade projects with SmartPath Connect on track to energize in December 2025 as well as higher gas investment driven by a further ramp up in gas mains replacement under our updated downstate rate cases. In New England the return on equity was 9.1 percent 92 percent of its allowance. This was 10 basis points lower than the prior year and 40 basis points higher after adjusting for a one-off property tax recovery last year. Underlying operating profit was £924 million pounds up 15 percent. This was driven by higher rates in our gas and electricity businesses including through our new capital tracker and delivery of cost efficiencies partly offset by higher depreciation and other costs. Capital investment was £1.75 billion pounds 5 percent higher driven by higher electric investment for increased asset health and maintenance work and the advanced infrastructure rollout. We also continued to invest in our gas networks including the replacement of 135 miles of gas mains this year. Moving to national grid ventures underlying operating profits including joint ventures was £455 million pounds £116 million pounds lower than the prior year. Higher profitability from a full year of Viking operations was more than offset by expected lower revenues on IFA2 and the North Sea Link. Capital investment was £378 million pounds down 43 percent reflecting the commissioning of our Viking Lint Inconector last year and the classification under IFRS of national grid renewables and grain LNG is held for sale from the end of September which means investments into these businesses are excluded from reported group capital investment. During the year our community offshore wind joint venture paused development activity in line with the broader slowdown of the U.S. offshore wind industry. Whilst there are longer-term trends that give us confidence in the need for offshore wind generation in the northeast significant near return policy uncertainty has led us to recognize an accounting impairment as an exceptional charge. We recorded an operating loss for activities of £143 million pounds including adverse fair value movements in the national grid partners portfolio. Net finance costs were £1.36 billion pounds £116 million pounds lower than the prior year with the benefits of lower net debt following the rights issue and lower inflation on index linked debt partly offset by the impact of higher refinancing costs where we have issued £73.2 billion pounds during the year. For the full year the underlying effective tax rate excluding the share of joint ventures was 15.4 percent 20 basis points lower than the prior year. This reflects high levels of capital expenditure qualifying for full expensing compared to last year. Underlying earnings were £3.5 billion pounds with EPS at 73.3 pence up 2 percent on the Moving down to cash flow cash generated from continuing operations was £7 billion pounds down 4 percent compared to the prior year. This decrease was driven by timing as we returned balancing charges within the ESO in the first half of the year following over recoveries in the prior year. Net cash inflow at £954 million pounds was £4.6 billion pounds higher than the capital investment. Combined with disposal proceeds from the ESO and the remaining 20 percent stake in gas transmission we saw a reduction in net debt of £1.7 billion pounds to £41.4 billion pounds. Moving to our FY26 guidance which is presented as an assumed exchange rate of $1.3 dollars to sterling. EPS growth is expected to be at the lower end of the 6 to 8 percent range reflecting the headwind of a slightly weaker dollar. Capital investment is expected to be over £11 billion pounds next year driving asset growth of around 11 percent and net debt is expected to increase by just over £6 billion pounds excluding expected proceeds from the National Grid Renewables and Grain LNG sales. As usual detailed business unit guidance has been provided in our results statement. Turning to the five year framework, as I said at the beginning as a result of our visibility and resilience we are reconfirming our financial framework from April 2024 to March 2029. We still expect to invest around £60 billion pounds over five years driving asset growth of around 10 percent and EPS growth of 6 to 8 percent from this year's baseline of 73.3 pence. Our aim remains to grow the dividends in line with average CPIH and we remain committed to maintaining our current investment grade credit rating. With that I'll hand you back to John.

Many thanks Andy. Before we move to your questions I want to spend just a few minutes setting out National Grid's priorities for the coming year and the journey we're on to support economic development, energy security and decarbonisation across our jurisdictions. Starting in the US where nearly half of our investment will be spent over the five year frame. From a regulatory perspective we have a number of key priorities. In New York having reached a joint proposal for our Niagara Moorhawk business we'll continue to engage with the PSC ahead of the anticipated approval by the commission in the summer. In Massachusetts we'll continue to work with the DPU to agree the recovery mechanisms under the electric sector modernisation plan. We'll also be preparing our next rate filing for Massachusetts gas and we'll work with the DPU to put forward a plan that balances investment needs and customer affordability. On policy we'll continue to work closely on its state energy plan to develop a comprehensive roadmap to a clean, resilient and affordable future for our customers. In Massachusetts having filed our climate compliance plan last month we'll be supporting the discovery phase over the coming months and we'll work with the state as they advance the energy affordability bill. And across our US businesses we're supporting our policymakers to understand the impacts and opportunities of increasing demand growth from data centres and we're supporting federal policymakers as they to look at resource adequacy in the region. Moving to the UK in electricity transmission our priority will be to continue to ramp up capital delivery including commissioning two further circuits of our London power tunnels project. Our primary regulatory focus for the year is to reach agreement with OFGEM on an investable Rio T3 framework that will allow us to deliver at the unprecedented scale and pace that is needed to meet the UK's ambitious climate goals. We expect OFGEM's draft determination to be published in June with a final determination in December ahead of a new regulatory period starting in April 2026. We'll also be focused on supporting the NISO with the re-contracting of the connections queue which in turn will clarify the specific investments and locations required in the out years of T3. Staying on the topic of connections we're also seeing significant increases in data centre requests with 15 gigawatts of signed contracts now in our pipeline. Our Rio T3 plan has been developed to meet this demand and we're also supporting the government's recently formed AI energy council. Here we're working to meet the challenges of increased power demand including proposals for AI growth zones dedicated to data centre development. On the policy front we expect to see the planning legislation progress through Parliament and we'll continue to advocate for wider planning reforms. Through our input into the NISO we'll support progress on the longer term strategic spatial energy plan which should align with the government's forthcoming industrial strategy and we'll want to see a skilled strategy developed which together with industry creates a collective view of the workforce needed for 2030 and beyond. In strategic infrastructure our priority is to continue to ramp up the ASTI programme where we'll be focused on stepping up work on the six wave one projects that are now under construction and finalising the procurement contracts for the remaining offshore projects. Once complete we'll have secured T1 supplier contractors for all 17 of our ASTI projects. We'll also be focused on the consenting process with a total of eight consultations planned this year. In our electricity distribution business our priority is to complete our targeted 100 million synergy benefits and deliver improved returns and following the publication of the ED3 framework decision document we look forward to engaging in the sector specific methodology consultation later in the year. Turning finally to National Grid ventures our priorities will be to complete the sale of National Grid renewables, agree the sale of Grain LNG having launched the process at the end of April and to continue the development of our Lion Link project in the UK and the Propel Transmission project through our New York Transco joint venture. So in summary it's been another year of enormous progress. As you'll have seen I've recently announced my decision to retire from National Grid and I'm delighted that the board has appointed Zoe Yonovich as my successor. She has all the attributes required to deliver on the significant growth opportunity ahead. I'm looking forward to welcoming Zoe in the autumn and working with her before handing over the reins in November. It's been an immense honour for me to work with so many talented people over the years and to lead the company I joined as a graduate. I'm very proud that National Grid is leading the way to a new energy era building the next generation of networks to unleash the energy needed to meet increasing demand. We're delivering extraordinary change at National Grid influencing the largest ever overhaul of our networks across all the jurisdictions that we serve. In a turbulent and unpredictable world National Grid is a beacon of stability with an investment proposition that provides high asset growth, strong earnings growth and an inflation protected dividend. In this context we remain focused on delivering secure, affordable and clean energy for our customers and communities whilst providing long-term value returns for our shareholders. As you've heard there is much to do in the coming months and I remain fully focused on ensuring we don't miss a beat so that I leave National Grid in the strongest possible position for its future success. Let me stop there and give you the opportunity to ask questions. Okay so there are lots of questions coming through so I'm going to start with Dominic from Barclays and then after that I'll go to Sarah at Morgan Stanley. So Dominic would you like to ask your question?

Hi there, yes thank you. It's Dominic from Barclays. So thanks for your presentation and also I'd just like to say thank you, appreciate your time. I wish you all the best in your decision on moving on. A couple of questions from me please. Firstly on Rio T3 we clearly have the D-Day now in the diary for the 25th of June. You submitted your business plans in December with I think a 35 billion tot-ex program and since then clearly there's been a few movements in UK policy and a few sort of projects sort of falling out and going sort of left and right. What do you, on your conversations that you've had with Ofgem, what do you expect to see different in the DD to sort of your business plan with regards to capex to the real nominal split in the in the debt calculation and on the returns where I think Ofgem was .5% real and I think you requested 6.3. And then the second question is just sort of following up from that is that the Iberian Blackout a couple of weeks ago, what sort of discussions have you had with policy makers and with the UK sort of regulators on kind of what happened, what the impact here and what sort of opportunities or changes are potentially needed in the UK to ensure that something like that doesn't happen here. Thank

you. Okay thanks Dominic. It's quite a lot isn't it. So why don't I start on Rio T3. I'll ask Andy to talk about nominal debt and then I'll come back on the Spain Blackout. I mean as you said we made the business plan submission in December and I'd say since then we've had really productive conversations with Ofgem. As you expect you know we're in the sort of last few months of the Rio T3 process that has been going for you know two and a half years I think. What I'd say is our focus at the moment is very much on the financial framework. You know we've been very stable with our investors and Ofgem recently and I'd like to thank our investors who attended that who directly you know reinforced the message that we've been giving Ofgem around the importance of an investable framework for Rio T3. Our focus continues to be as it was when we made the submission in December. You know there are three elements to the financial framework. The first is the returns. We'd be very clear that we believe that in the range that Ofgem set out the base return should be at the top end and in our submission we talked about 6.3 being an appropriate level but also on top of that the cash characteristics need to be right to get the right balance of earnings growth and asset growth and also that the incentives are there as well to get to a sensible return that's comparable to what we see internationally. So all of that conversations are going on as you'd expect. In terms of the investment levels you know in terms of ASDI which is a big part of electricity transmission we don't see the recent announcements impacting on that investment profile and the 35 billion that we submitted is consistent with everything that we talked about with regards to ASDI and the 60 billion so electricity transmission makes up about 23 of the 60 different time frames but that 23 is consistent with the 35 we submitted in the business plan. Andy do you want to talk about nominal debt?

Yes and thanks Dominic. I think Ofgem were fairly clear in their SSMD about signalling the direction of travel on moving to a sort of a nominal debt approach. We've seen nothing since then that would indicate you know that's less likely than it was. Obviously we'll have to wait and see what comes out on the 25th of June but everything we're seeing at the moment is that you know remains the most likely direction of travel but I think as John said you know for us that's one element of ensuring that the total package gives us you know the right balance and including cash characteristics overall. Clearly a move to a nominal debt does serve to accelerate some level of cash but it's only a portion of I think of the overall level that we've asked for in our business plan so yes that's what we'll be looking for on the 25th.

In terms of the the incident in Spain Dominic I think we're all waiting to see what comes out the investigation. As far as I'm aware there is no clarity yet on the root cause. Lots of speculation and lots of hypothesis and what I do think is massively important that given the increasing dependency society has on electricity you know not just for lighting but for heat and transport going forward that actually things like resilience are looked at very carefully. I can talk about the UK in terms of you know I've seen some of the hypotheses around renewables and you know when the National Energy System operator was part of National Grid as the electricity system operator you know we started several years ago looking at pathway products as we call them which are effectively technical products that would be needed to support a renewable system so things like frequency response from different sources voltage control reactive power and inertia and I know the you know the National Energy System operator holds a certain level of inertia on the system depending on how much renewables are there so that's standards in place in the UK but the reality is we need to wait to see what comes out of the investigation what the root cause is and then from that we'll be able to to learn any lessons that are relevant for the UK. Thank you. Okay so I was going to go to Sarah next from Morgan Stanley and then after that I'll go to Pavin at JP Morgan. So Sarah would you like to ask your question?

Yes thank you very much but first and foremost John congratulations for all you've achieved during your time at Grid. I've got two questions please the first one it's slightly different but similar vein to Dom's second question mine specifically related to NISO's final recommendations and conclusion report on the North Hyde substation fire that we're expecting by the end of June that you mentioned. Just wondering what you expect to see in that that's tangible for the direction of investment needs or maybe put differently what would you like to see in that final report? And then secondly a high level question please and given the upcoming CEO succession I feel like it's very much obligatory to ask a reflective question. So John I'm curious how would you pitch the National Grid equity story today versus how you would have pitched it on day one in the CEO seat? Thank you.

Thank you Sarah you've made me laugh this morning nothing else. Look let me talk about the North Hyde incident so first of all as you can imagine we were we were pleased to see the interim report that came out from NISO last week. I think it was really sensible to set out the time frame the sequence and the next steps as an initial sort of part of the report. We are working closely with NISO we're providing all the information that you can imagine that is needed for that type of investigation. I'm hopeful that the report that comes out in June will cover all aspects of the incident. So as you know from our perspective it was a very rare event you know in my very long career I can't remember a circumstance we've had such a ferocious fire that's taken out the substation but also power was also available into the local area into the Heathrow right through that throughout two of the substations. So I'm hoping it will look at the you know the specifics of the acid failure at the substation it will look at broader resilience issues it will look at the interaction between transmission distribution and national critical infrastructure and it will look more broadly around you know the changing nature of networks as they go forward from the scope of the terms of reference I've seen I think it will cover all those aspects and we look forward to seeing the report when it comes out at the end of June. In terms of I didn't quite get the question but in terms of the as I move on from National Grid you know the proposition that National Grid makes today to its equity investors is very clear you know it is very much a growth and dividend proposition and as you know we've set out for the next five years that we're looking to grow the acid base by 10 percent and we're looking to grow the dividend or policies to grow it in line with CPI-H and that very much is the focus for National Grid. I think from where I started back in 2016 you know growth was significantly lower back then we were more typical perhaps of what people expect in utility but as we look forward you know growth is an important part of the proposition and that is all underpinned I think by the fact that you know as we said in our results today you know what National Grid is it's very predictable it's very stable and has an incredibly resilient business model in a world in which there's quite a lot of turbulence so that proposition of growth and yield but also stability and predictability I think is the key to an equity proposition for our investors.

Perfect thank you.

Thanks Sarah. Okay so we'll go to Palin and then after that we'll go to Mark at UBS.

Hi team good morning thank you for taking my questions and John I'd echo Dom and Sarah's congratulations on your career at National Grid. My two questions are firstly you mentioned John in your speech some of the measures you're taking on affordability in Massachusetts I guess if you can go into a bit more detail on what you're seeing on affordability pressure in the U.S. any pressure you're seeing on returns and how your conversations are going with the U.S. regulators and with U.S. policymakers on this topic and my second question is on the planning and infrastructure bill I appreciate it may not have on your five-year frame and I think you say this in your statement but are there any can you talk about any positives that could be there in the five-year frame or certainly beyond that how we should think about that affecting National Grid please? Thank you.

Yeah thanks Palin. I mean in terms of affordability I mean I think you're aware that National Grid thinks very carefully and thoughtfully around any case that we're doing to make sure we get the balance right between the investment that you know many of our regulators and policymakers wanted to make and ultimately affordability and therefore we have lots of deep conversations with our regulators to make sure that any submission reflects that. In New York you'll have seen that in terms of you know if I take our latest rate case in NYMO we've got a joint proposal which is for three years and within that we've actually smoothed out the increase in the bills over that three-year period to reflect the fact that you know commodity prices have been quite high in the U.S. during the winter and therefore that's you know mitigates the impact for customers whilst doing the investment we need. We also set aside about 290 million dollars to support vulnerable customers over that rate case period with nearly 100 million in the first year so again that's us working closely with the regulator to make sure we got that balance right. In terms of returns then in New York you know as you saw in the joint proposal we've actually got a joint proposal that increases our returns I think reflecting the nature of the investments that we're doing from from nine to nine and a half percent for Niagara Mohawk and similarly in downstate New York you would have seen the three-year rate case there where we saw an increase to 9.35 so I think the regulators are thoughtful in making sure that you know it is an investable proposition as we do this significant investment but we are careful as we think about affordability. In Massachusetts you would have seen and you know as a reference in my speech you know high commodity prices during the winter meant our gas customers were struggling a bit and then we were very happy to work with the regulator to provide a 10 percent discount on bills in March and April which we will then recover in the summer when commodity prices are low and as we look forward again we will be very thoughtful both in terms of how do we reflect that in affordability and you may have seen this week actually that the the governor of Massachusetts has launched an initial affordability bill it's a 120 page document and we will work through that with the governor's office and the PSC to see how we can support and contribute towards that as it goes through the sort of various mass nations of committees and the senate and congress and so on so that's sort of how we think about affordability but it's an important issue you're quite right to raise it. In terms of billing and infrastructure the planning and infrastructure bill I mean a lot of what's in that bill are things that NASHQA has been advocating for so we're sort of really pleased with that the government is moving forward with that so there's a lot in there that will streamline the planning process and make it more effective and shorter there is some legislation in there to make the ability to challenge more focused and of course there's proposals for things like community benefits and there's also been a recent amendment actually to shorten the statutory consultation process that again could potentially take about a year out of the planning process in the UK so we're very supportive of all of that and in my speech I referenced the fact that it will help to de-risk I think some of the ASTE projects and some of the legislation will absolutely do that but most of the ASTE projects were already in train so you know as you've heard are six projects are phase one are already have planning and are in construction we've got eight consultations running this year so the time the legislation goes through we would have been through the majority of our ASTE projects in terms of the planning process so I think it really helps us as we move into the 2030s and beyond.

Thank you.

Okay thanks Polly I'll go to Mark next and then Ahmed from Jeffrey so Mark would like to ask you questions.

Hey John no so firstly congratulations on the shareholder returns you've generated over the last nine or ten years and looking looking forward to seeing where you move on to once you retire from National Grid but I have two questions one for you John one for Andy. John EGL1 which you haven't mentioned is 16 months late very early on in the project it's a two and a half billion project and I think off-gems minded you know from their wording in their document there they're clearly minded to give you you a penalty you and your partners a penalty for that given you know you speak a lot about the framework agreements and booking out the supply chain but the supply chain is is struggling so how can we sure that we're not going to see other further delays like this 16 months delay to EGL1. My second question for for Andy is just on community wind when we spoke previously my understanding was National Grid has certain protections to put the project back to your partners RWE you've written off what would seem most if not all of it today. Is there any chance of you recovering some of the cash somehow from that or or is that 300 million completely a sunk cost and now an impaired cost? Thank you.

Thanks Mark and thanks for your comments as well. I mean in terms of EGL1 I don't think you you should infer anything about the other ASTI projects when you look at EGL1. EGL1 actually has quite a long history and a lot of it was developed under the LOTI process rather than the ASTI process and all the regulatory frameworks that we put in place around that. Having said that you know at the point of which we were asked to take the project forward because there was a debate about whether it was going to approach a competition or not we immediately went out to the market to see what was available in the supply chain and the reaction from the supply chain was they could they could support it but in a slightly different time frame. You've seen the consultation for OFGEM in which they've said that they're not minded to give us the extension but one of the things they say in the consultation is that they don't feel that we provided sufficient evidence on what the world world supply chain looks like so that consultation is still live as you can imagine we are going back to OFGEM we believe we have significant evidence to demonstrate that actually there was a limitation in terms of the time scales of that supply chain could deliver at the point at which we were asked to take that project forward. For the other ASTI projects as you know we've got an awful lot of things in place including advanced procurement mechanisms and also licenseability associated with the supply chain so I don't think you should read anything across from EGL1 for the other projects. We'll our focus at the moment is providing that data to OFGEM and the evidence to OFGEM that they require to get them comfortable that actually making a move in the date is an appropriate thing to do. Andy?

Morning Mark thanks for the question. I guess just to remind you what I said in the presentation this morning you know we've worked very closely and continue to work very closely with our partner RWE on both the short-term decisions around the the pause in our development activity on community offshore wind but also continue to be alive to you know how that may evolve in the future and very much you know looking to continue to see options to take forward that commercial opportunity. So what we've announced this morning is very much an accounting impairment given the short-term uncertainty created by some of the recent pronouncements and other activities in the northeast from an accounting perspective we believe it's appropriate to impair the value. To your question it's we've fully impaired our investment down to zero with the 303 million that we've disclosed this morning but as I said and John said in his remarks I think we continue to view that there are likely further energy needs in the northeast and you know to the extent that means this project comes back on we will be you know very close working with RWE to pursue that. In terms of the protective rights I think we've always said that yes we do have them but they're attached to you know particular milestones through the course of the project and of course that will therefore be dependent on on whether those projects go ahead as to whether those rights come into play.

Okay thank you very much gentlemen.

Thank you Mark. So I'll go to Ahmed now at Jeffries and then perhaps deeper at Bernstein so Ahmed.

Yes thank you John and firstly again best wishes from from my side as well. I have three questions actually just coming back to the comments you made about affordability in the New York region. I saw some press commentary you know from the New York governor yesterday which talks about you know the affordability and how sort of the bill rises sort of coming through from rates reviews and that's obviously sort of coming despite sort of the measures that you have highlighted. So how should we think about particularly around the NIMO process from here? Is there something more to be done? Could the process be longer from here or does this need to be better engagement between the stakeholders on what's actually sort of getting implemented? So that's my first question. My second question is I would be interested in your perspective on the other sort of sort of victim aid of zonal pricing in the UK particularly if you think that would sort of that could play a big role in defining transmission investments into the 2030 period in the UK and then finally one for sort of any you know the guidance for this year seems to be you know ahead of where consensus expectations are. Is there anything specifically you will call out where you sort of see the better versus consensus? Thank you.

Thanks Amit. I mean in terms of I'll start with the affordability and then Zonal and then I'll need to control the guidance. In terms of the affordability I mean I'll just reiterate I think what I've said which is we work very closely not just with the PSC but with the governor's office to make sure we get the balance right and I was pleased that you know the joint proposal that we put forward was one that enabled us to be able to make those investments. It's about five and a half billion across the three years both electricity and gas but with a single digit increase in bills and we didn't see any intervention from the governor in the same ways that's happened with you know other utilities to be to be to be blunt. So I think we've tried to get the balance right recognizing what's going on in New York and as I said there's quite a major investment in supporting vulnerability with a $190 million as well which has been supported by PSC staff so I think we're in a reasonable shape but we're very conscious around that. In terms of Zonal pricing but I mean we spend a lot time thinking about Zonal pricing it doesn't immediately impact on national grid to be honest and people are talking about implementation because it's incredibly complex over a sort of five-year period so something for the early 2030s so it's not going to impact on our 60 billion capital investment program. Lots of debate in the industry as everybody's aware I mean we can see that there are potential advantages for Zonal pricing in terms of things like price discovery, locational signals and resolution of operational constraints but at the same time we can also see there's just a huge amount going on in the industry at the moment with retail reform, connections reform, the rollout of smart meters, the scale of investment right across the industry that requires a degree of sort of stability and certainty so that people are comfortable with that so I think the bar for any incremental change on top of what's already going on should be very very high and my sense at the moment is that probably now is probably not the right time for introducing a major reconstruction of how the market operates through Zonal pricing and that you know in the 2030s the networks will look very different and I think maybe that's the when you might potentially look at the advantages of Zonal pricing but to do it today I think it just doesn't feel like the right time. Andy?

Yes and morning Ahmed thanks for the question. Yeah as you'll be aware this is the first time we're giving formal in-year guidance for FY26. Previously we've obviously given our five-year frame where we've guided to the six to eight percent CAGA over the five years. I think previously we said that there was there was no reason we wouldn't expect sort of things to be relatively linear so no real surprises for us is you see we've guided to being within the six to eight percent range next year or in FY26 albeit towards the lower end with the impact of the dollar move and that will continue to come from investment driven growth in our businesses and obviously some of the new rate cases coming in in the U.S. as coming from our U.S. businesses.

Thank you.

Thanks Ahmed.

So let me go to Deepa at Burnston and then after Deepa I'll go to Martin at Bank of America. So Deepa?

Thank you so much. Congratulations Sean and thank you so much for your leadership. The two questions that I had one was on EV underperformance so you're now guiding that the outperformance is lower obviously this year you have a storm impact but would you walk through what exactly is the cost item that's deviating on the RPEs and is there any sort of read across to Rio T3 could something similar kind of pop up there and what mechanisms will you use that and my second question is on your Rio T3 plan out of the 35 billion of Tartex roughly 9 billion or so is unconfirmed sort of projects. So just wondering given everything else you've been seeing with the connections just for man 2030 clean plan do you expect a substantial chunk of that 9 billion to also get implemented during Rio T3 and I do recognize that your five-year frame and the T3 frame is off by a couple of years right so where would you see that that 35 billion realistically being delivered in Rio T3? Thank you.

Okay sure yeah good morning Deepa thanks for the question. Yes so as we said this morning I think we've seen two headwinds flowing through the electricity distribution ROE for the for the year one of the due to storm Dara where we've seen you know pretty much unprecedented certainly recent memory severity of that in the storms impact and that's flowed both in terms of direct costs but also in terms of how it impacts the incentive the customer incentive performance and connections incentives that's about you know about half of the the impact and then the other half has come through from the RPEs and the issue there again as I said in my presentation is the way the indices are set up within ED2 means that effectively there are the more generic indices and what they've done is the performance of those industries hasn't really really been able to attract the cost experience that we've seen. I think we view this as a sector wide issue we've you know if you look across some of the other DNOs and it is definitely something that we would look to you know take forward into the conversations with OFGEM around ED3 obviously very early stages there. We will continue to look to offset that you've seen in our guidance that we're guiding towards 50 basis points of outperformance next year and growing towards 100 by the end of ED2. In terms of your question around is there read across to transmission? No everything we've seen the way the indices are set up in transmission is they much better relate to the type of spend that we have and the indices there are demonstrating that the RPE mechanism is doing its job and making sure there is there is sort of protection in the way allowances shift within the transmission business.

And in terms of the REOT3 I mean I'd say that I think I said in my speech that you know of the 60 billion 23 billion is ET and we still believe that is you know our best view of what it's going to look like between now and 2029. Beyond that we're still comfortable with the 35 that we set out in our in the REOT3 business plan. I think one of the key things over the next 12 months that will give us a little bit more solidity at the back end of REOT3 is the connections reform process. So as you know OFGEM have now made the decision on connections reform moving from a first come first serve to the first ready and needed for CP 2030. Over the course of this year NISO and the electricity transmission company companies including National Grid have to now reorder the queue and it will be done in sort of chronological order starting with 27 28 29 30 and that needs to be done by December of this year. I think that will help to give us a better indication of the makeup of the REOT3 plan. As you recall the way it was submitted to OFGEM was in two parts there was 11 billion that was absolutely certain and then 24 billion that you know required some work to be done on it. So at the moment we're so comfortable with that but I think the connections reform process will give us a bit more solidity at the back end and we'll be able to update once we've done that. So with that I'm going to move to Martin which I think is the last question that we have. So Martin over to you.

Yes thank you for taking my questions and congratulations on a very distinguished career with National Grid. So my first question is related to the risk of higher tariffs in the US. You mentioned that 95 percent of the supply chain is domestic but could you give us some examples what is included in that five percent that is not domestic at what actions have you taken or you could be taking to mitigate any potential risks that could occur. And my second question is actually related to the guidance you have provided for the current financial year. So you're guiding for net financial expenses to be only increasing by 40 million I believe whereas you expect net debt to increase by as much as six billion. So why such a limited increase in financial expenses despite significantly higher net debt. Thank you.

Okay thanks Martin I'll take the first and then I'll undertake the guidance question. I mean in terms of high tariffs just to reiterate so we don't see it having a significant impact partly because more than 90 percent of the products and services that source in the US are domestic. I mean if you just go down a level we do have a supply chain for things like pull top transformers in Mexico and we do import some steel from other countries including India and Canada but we have the opportunity as I said even at the aggregate level it's not particularly material and then there are mitigations both through regulation but also for looking alternative sources as well. There are plenty of supply chain opportunities for things like pull top transformers in the US should we need to do that. So yeah so those are this those are some of the examples Andy.

Yes and again thanks for the question. Yes so I think there's two things to factor into thinking about the guidance we've given on overall financing costs. One is of course as we continue to invest heavily in our capital program there will that means although there will be increased funding costs there will be a degree of increase in capitalized interest as well which offsets the sort of the gross impact from a funding perspective and then secondly and you'll have seen that we were very explicit that our net debt increase excludes the potential proceeds from our disposals both the completion of the NG renewables business but also the the planned sale of the of LNG grain and therefore you know basically our guidance on the interest line does make a net assumption for the impact of those.

Thanks Andy. It doesn't seem to be any more questions so let me just say first of all thank you everybody for your kind words and comments. I guess our key message today is there's been strong strong performance in the first year of our five-year plan. We're certainly seeing the benefits of the resilient business model we have here at Nascar which delivers stable and predictable outcomes and we're very well positioned with all the work that we've done in the first year to deliver on the five-year 60 billion pound capital investment plan. So with that I'm going to thank everybody for joining us and I hope for those who are based in London we'll see some of you this afternoon for our discussion in more detail on the capital investments both in the UK and in the US. Thanks very much everybody.