Tag: investors

Good financial performance

• Group Adjusted EBITDA up 9% to £250 million
• Continued strong cash generation and balance sheet
  • 3x net debt to Adjusted EBITDA (2017: 1.6x net debt to Adjusted EBITDA)
  • Net cash from operating activities of £311 million (2017: £315 million)
  • Net debt⁽⁴⁾ of £319 million (2017: £367 million)
• Dividend growth – 15% increase in dividend per share – 14.1 pence per share (2017: 12.3 pence per share)
• £50 million share buy back programme completed
• Total profit before tax of £14 million includes gains principally related to foreign currency hedging of £38 million (2017: Total loss before tax of £204 million including unrealised losses of £177 million)

Dam and reservoir, Cruachan Power Station

Acquisition of ScottishPower Generation has accelerated strategy

• 6GW multi-site, multi-technology portfolio of pumped storage, hydro and gas
• Strong strategic fit with UK’s need for flexible, low carbon and renewable generation
• High quality earnings with expected returns significantly in excess of weighted average cost of capital

Good progress with strategic initiatives

• Successful low-cost conversion of fourth biomass unit
• Third US biomass pellet plant commissioned and fully operational
• Progress with biomass cost reduction programme including sawmill co-location and rail spur development
• Commenced BECCS⁽⁵⁾ pilot project and equity investment in C-Capture – technology proven with CO₂ captured
• Development of B2B Energy Supply customer and IT platform

Outlook

• Continued growth in Adjusted EBITDA, cash generation and dividend
• Integration of ScottishPower Generation
• Continue to expect Capacity Market to be reinstated on same or similar basis
• Attractive investment options for growth: biomass cost reduction, biomass capacity expansion and new gas

Will Gardiner, Chief Executive of Drax Group plc, said:

“Drax is now one of the leading generators of flexible, low carbon and renewable electricity in the UK. As the grid decarbonises, our ability to support intermittent renewables will become increasingly important as we strive to deliver our purpose of enabling a zero carbon, lower cost energy future.

“Drax performed well in 2018. Our commitment to operating safely and sustainably remains at our core. We commissioned our third pellet production plant, which contributed to our good results. After a difficult first quarter for our Power Generation business, we delivered strong availability and financial results. Whilst the year was challenging for our B2B Energy Supply business, we continued to grow our customer base and are investing in the significant opportunity created by smart meters.

“We are confident in our ability to continue growing our earnings and advancing our strategy through the year. We have attractive investment opportunities throughout our business, and while short-term uncertainty over the Capacity Market remains, we look forward to developing those opportunities in a disciplined fashion.”