Drax reports 'robust' first quarter performance

Power generation company Drax reported a robust first quarter as it worked towards its decarbonisation targets.

The company on Wednesday said it continued to net debt to adjusted core earnings to return to its long-term target of around two times by the end of 2022.

Drax completed the sale of its existing gas generation assets in January 2021, and bought Canadian biomass producer Pinnacle Renewable Energy.

The Pinnacle deal “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”, the company said.

Drax had cash and total committed facilities of £801m at the end of March, and will retain Pinnacle's existing debt facilities within the enlarged group's capital structure “but will consider opportunities to optimise its balance sheet with lower cost sources of debt”.

“Full year expectations for the group remain underpinned by continued good operational availability for the remainder of 2021,” it added.