Drax Group projected to ride the green wave to profits

Drax Group shares were up 4.5% to 830p in late afternoon trading on Wednesday, after the company reported an adjusted EBITDA for 2022 at the top range of analysts expectations in its trading update for Q1 2022, pending strong operational performance.

The firm said it estimated a net debt to adjusted EBITDA to come in significantly below 200% by the end of the year.

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Drax Group highlighted a rate of over 99% in energy generated from renewables, including sustainable biomass, hydro and pumped storage.

The company further noted 400 kilo-tonnes of new biomass pellet production capacity which it commissioned in the southeast US.

Drax Group announced a final dividend of 11.3p paid to shareholders today, and a total dividend of 18.8p per share for 2021, against a 17.1p dividend in 2020.

“In the first quarter of 2022 we delivered a strong system support performance as our reliable, renewable electricity continued to support UK energy security and helped to keep the lights on for millions of British homes and businesses,” said Drax Group CEO Will Gardiner.

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“With the right government support, Drax is ready to invest £3bn this decade in delivering vital renewable energy technologies including BECCS, a carbon removal technology that is cost-effective but also the only one that generates reliable, renewable electricity while removing millions of tonnes of CO2 from the atmosphere.”

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