(Alliance News) - Drax Group PLC's trading had been "robust" in the first quarter, and full-year expectations remain underpinned by "good operational availability" for the remainder of the year, it announced on Wednesday.
The Selby, England-based electrical power station operator said it had made progress in its continued focus on clean energy and reducing carbon emissions.
It still expects its ratio of net debt to adjusted earnings before interest, tax, depreciation and amortisation to be around 2 times by the end of 2022. Drax was in a healthy cash position as at March 31, with cash and total committed facilities of GBP801 million.
This month Drax completed its acquisition of Pinnacle, which advances its biomass strategy by more than doubling its sustainable biomass production capacity, reducing its cost of production and adding a major biomass supply business. The enlarged supply chain will have access to 4.9 million tonnes of operational capacity from 2022.
Drax said it is now positioned as the "world's leading sustainable biomass generation and supply business", and will further its ambition to be a carbon negative company by 2030.
"In the first quarter of 2021 we delivered a robust trading and operational performance, alongside steps to further decarbonise the business and support our flexible and renewable generation strategy," said Drax Chief Executive Will Gardiner.
"These include the end of commercial coal generation, the sale of our gas power stations and just last week we acquired leading Canadian biomass producer Pinnacle Renewable Energy Inc.
"The acquisition of Pinnacle positions Drax as the world's leading sustainable biomass generation and supply business. This advances our strategy to increase self-supply, reduce our own cost of biomass production and create a long-term future for sustainable bioenergy, which will pave the way for the development of negative emissions from Bioenergy with Carbon Capture and Storage."
A final 2020 dividend of 10.3 pence per share will be paid on May 14, subject to shareholder approval. The payout brings the total dividends paid for the year to 17.1p per share, giving 7.5% year-on-year growth.
Shares in Drax were down 0.7% at 417.51 pence in London on Wednesday.
By Will Paige; willpaige@alliancenews.com
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