Drax Share News (DRX)

(Sharecast News) - Power company Drax said on Thursday that both revenue and underlying earnings had fallen in the six months ended 30 June

Drax said adjusted EBITDA came to £460m in H1, down from £515m at the same time a year earlier, reflecting lower achieved power prices, while group revenue dropped 12% to £2.4bn.

Adjusted earnings per share, however, held steady at 65.6p, and Drax hiked its interim dividend by 11.5% to 11.6p per share.

Operationally, biomass generation remained strong, producing 7.1TWh and contributing 5% of UK electricity and 11% of renewables. Pellet production rose 5%, with EBITDA jumping 14% to £74m. Drax's flexible generation portfolio delivered £81m EBITDA, despite planned outages.

Looking ahead, Drax reaffirmed its FY EBITDA guidance of £899m and maintained its post-2027 target of £600-700m annually.

Drax also said it plans to launch a £450m share buyback extension, supported by an expected £500m working capital inflow in 2027.

CEO Will Gardiner said: "During the first half of the year, we made significant progress towards ensuring we continue to play an important role in UK energy security through this decade and beyond, reaching a heads of terms with the UK Government on a low-carbon dispatchable CfD.

"The energy transition is creating significant value opportunities aligned with the UK's energy needs and we will continue to explore investing in those in a disciplined fashion consistent with our capital allocation policy."

As of 0810 BST, Drax shares were up 4.20% at 706.50p.

Reporting by Iain Gilbert at Sharecast.com