Full year results presentation [PDF]
Tag: investors
Full year results [PDF]
Full year results for the twelve months ended 31 December 2018
RNS Number: 0765R
Drax Group PLC
| Adjusted(1) | Total | |||
| Twelve months ended 31 December | 2018 | 2017 Restated(2) | 2018 | 2017 Restated(2) |
| Key financial performance measures | ||||
| EBITDA (£ million)(3) | 250 | 229 | ||
| Profit / (loss) before tax (£ million) | 37 | 5 | 14 | (204) |
| Basic earnings / (loss) per share (pence) | 10.4 | 0.7 | 5.0 | (41.3) |
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.”
Operational review
Pellet Production – Focus on good quality pellets at lowest cost
- Adjusted EBITDA of £21 million (2017: £6 million)
- 64% increase in production to 1.351 million tonnes (2017: 0.822 million tonnes)
- LaSalle Bioenergy (LaSalle) commissioned and fully operational – 0.5Mt pellet capacity – performing well
- 10% reduction in cost per tonne
- Biomass cost reduction initiatives – future benefits
- Co-location and offtake agreement with Hunt Forest Products for low-cost sawmill residues at LaSalle
- LaSalle rail spur – $10/tonne reduction in transport cost to Baton Rouge port facility – commissioning 2019
- Relocation of administration from Atlanta to Monroe – greater operational focus and savings
Power Generation – Optimisation of portfolio, system support services and development of decarbonisation projects
- Adjusted EBITDA of £232 million (2017: £238 million)
- Impact of rail unloading outage and generator outage on one ROC(6) unit in Q1 2018
- Lower margins from coal generation – coal and carbon costs
- System support revenue of £79 million (2017: £88 million) – specific Black Start contract in Q1 2017
- Suspension of Capacity Market – £7 million of revenues not accrued in Q4 2018
- Optimisation of ROC generation, biomass operations and procurement of third party biomass volumes
- Biomass earnings benefited from conversion of fourth unit and insurance proceeds on historic outages
- Electricity output (net sales) down 8% to 18.3TWh (2017: 20.0TWh)
- 75% of generation from biomass (2017: 65%)
- Strong biomass availability – 91% (2017: 79%)
- Reduced biomass generation in Q1 2018 offset by strong unit availability Q2-Q4 2018
B2B Energy Supply – Profitable business, growth in customer meters, challenging market environment
- Adjusted EBITDA of £28 million (2017: £29 million)
- 5% increase in customer meters to 396,000 (2017: 376,000)
- Increase in bad debt and provisioning reflecting challenging environment
- Mutualisation of renewable costs associated with competitor failure
- Higher gas costs due to weather and mutualisation
- Benefit of full year of Opus Energy (2017: 10.5 months)
- 22% growth in gross profit to £143 million (2017: £117 million)
- Development of flexibility and system support market
- Continued investment in next generation systems to support growth and operational efficiency
Group financial information
- Total basic earnings per share of 5.0 pence, includes write-off of coal-specific assets (£27 million) following fourth biomass unit conversion, costs associated with acquisition and on-boarding of ScottishPower Generation, restructuring costs in Opus Energy and Pellet Production (£28 million), and unrealised gains on derivative contracts (£38 million)
- Tax credit of £6 million includes benefit of Patent Box claims – corporation tax rate of 10% on profits arising from the use of biomass innovation
- Capital investment of £142 million
- Maintaining operational performance (£55 million), enhancement (£40 million), strategic (£35 million) and other (£12 million)
- Net debt of £319 million, including cash and cash equivalents of £289 million (31 December 2017: £367 million)
View complete full year report
View analyst presentation
Register and watch 9am webcast of presentation
Notice of full year results announcement
RNS Number: 5293Q
Drax Group PLC
Notice of Full Year Results announcement
Drax Group plc (“Drax”) confirms that it will be announcing its Full Year Results for the twelve months ended 31 December 2018 on Tuesday 26 February 2019.
Information regarding the results presentation meeting and webcast is detailed below.
Results presentation meeting and webcast arrangements
Management will host a presentation for analysts and investors at 9:00am (UK Time), Tuesday 26 February 2018, at The Lincoln Centre, 18 Lincoln’s Inn Fields, London, WC2A 3ED.
Would anyone wishing to attend please confirm by e-mailing [email protected]
or calling Christopher Laing at FTI Consulting on +44 (0)20 3727 1355.
The meeting can also be accessed remotely via a live webcast, as detailed below. After the meeting, the webcast will be made available and access details of this recording are also set out below.
A copy of the presentation will be made available from 7:00am (UK time) on Tuesday 26 February 2019 for download at: www.drax.com>>investors>>results-reports-agm>> #investor-relations-presentations or use the link https://www.drax.com/investors/results-reports-agm/#investor-relations-presentations
Event Title: Drax Group plc: Full Year Results
Event Date: Tuesday 26 February 2019, 9:00am (UK time)
Webcast Live Event Link:
webcast.merchantcantoscdn.com/webcaster/dyn/4000/7464/16531/111250/Lobby/default.htm
Start Date: Tuesday 26 February 2019
Delete Date: Monday 24 February 2020
Archive Link: webcast.merchantcantoscdn.com/webcaster/dyn/4000/7464/16531/111250/Lobby/default.htm
For further information please contact Christopher Laing on+44 (0)20 3727 1355.
Website: www.drax.com
End of Share Repurchase Programme
Drax Group plc (the Company) announces that following the purchased ordinary shares on Monday, 21 January 2019, the Company’s £50 million share buyback programme, managed by J.P. Morgan Securities plc, which was announced on 20 April 2018, was completed in accordance with its terms.
In aggregate between 20 April 2018 and 21 January 2019, the Company repurchased 13,841,295 ordinary shares.
Enquiries:
Investor Relations:
Mark Strafford
Media:
Ali Lewis
Website: www.drax.com
END
Completion of the acquisition of Scottish Power’s portfolio of pumped storage, hydro and gas-fired generation
RNS Number : 8681L
Drax Group PLC
Drax Group plc is pleased to announce that it has completed the acquisition of Scottish Power’s portfolio of pumped storage, hydro and gas-fired generation, which comprises ScottishPower Generation Group and its wholly owned subsidiary, SMW.
The Acquisition was originally announced on 16 October 2018.
Enquiries:
Drax Investor Relations: Mark Strafford
+44 (0) 1757 612 491
+44 (0) 7730 763 949
Media:
Drax External Communications: Matt Willey
+44 (0) 7711 376 087
Website: www.drax.com
END
Result of General Meeting
RNS Number : 2803L
Drax Group PLC
| No. | Brief Description | Votes For | % | Votes Against | % | Votes Total | Votes Withheld |
|---|---|---|---|---|---|---|---|
| 1. | To approve the acquisition of the entire issued share capital of ScottishPower Generation Limited | 268,580,494 | 85.75 | 44,619,027 | 14.25 | 313,199,521 | 21,841 |
The resolution was carried. Completion of the acquisition is expected to occur on 31 December 2018.
The number of shares in issue is 407,193,168 (of which 12,867,349 are held in treasury. Treasury shares don’t carry voting rights).
Votes withheld are not a vote in law and have not been counted in the calculation of the votes for and against the resolution, the total votes validly cast or the calculation of the proportion of issued share capital voted.
A copy of the resolution is available for inspection in the Circular, which was previously submitted to the UK Listing Authority’s Document Viewing Facility, via the National Storage Mechanism at www.morningstar.co.uk/uk/NSM.
The Circular and the voting results are also available on the Company’s website at www.drax.com.
Enquiries
Drax Investor Relations
Mark Strafford
+44 (0) 1757 612 491
+44 (0) 7730 763 949
Media, Drax External Communications
Matt Willey
+44 (0) 7711 376 087
Website: www.drax.com
END
Publication of Circular and Notice of General Meeting in relation to proposed acquisition of flexible, low-carbon and renewable UK power generation from Iberdrola
RNS Number : 5576J
Drax Group PLC
Drax is pleased to announce that a Circular in relation to the Acquisition (the “Circular”) has been published.
The Acquisition is subject to the approval of the shareholders of the Company and, accordingly, the Circular contains a notice convening a general meeting of the Company to be held at the offices of FTI Consulting, 200 Aldersgate Street, London EC1A 4HD on 21 December 2018 at 10:00 am.
The Circular, which has been produced in accordance with the Listing Rules of the Financial Conduct Authority, will shortly be available on the Company’s website at www.drax.com. In accordance with Listing Rule 9.6.1 a copy of the Circular has been submitted to the National Storage Mechanism and will be available shortly at www.morningstar.co.uk/uk/NSM. Printed copies of the Circular will be posted to shareholders who have elected to receive them.
Expected timetable of principal events(1)
| Latest time and date for receipt of Forms of Direction | 10:00 am on 17 December 2018 |
| Latest time and date for receipt of Forms of Proxy or Crest Proxy Instructions | 10:00 am on 19 December 2018 |
| General Meeting | 10:00 am on 21 December 2018 |
| Expected date of Completion | 31 December 2018 |
Enquiries:
Drax Investor Relations:
Mark Strafford
+44 (0) 1757 612 491
+44 (0) 7730 763 949
Media:
Drax External Communications:
Matt Willey
+44 (0) 7711 376 087
J.P. Morgan Cazenove (Financial Adviser and Joint Corporate Broker):
+44 (0) 207 742 6000
Robert Constant
Jeanette Smits van Oyen
Carsten Woehrn
Royal Bank of Canada (Joint Corporate Broker):
+44 (0) 20 7653 4000
James Agnew
Jonathan Hardy
Notes
- Future dates are indicative only and are subject to change by Drax, in which event details of the new times and dates will be notified to the Financial Conduct Authority and, where appropriate, shareholders.
- References to time in this announcement are to London time.
- J.P. Morgan Limited (which conducts its UK investment banking business as J.P. Morgan Cazenove) (“J.P. Morgan Cazenove”) and RBC Europe Limited (“RBC”), which are both authorised by the Prudential Regulation Authority (the “PRA”) and regulated in the United Kingdom by the FCA and the PRA, are each acting exclusively for the Company and for no one else in connection with the Acquisition, the content of this announcement and other matters described in this announcement and will not regard any other person as their respective clients in relation to the Acquisition, the content of this announcement and other matters described in this announcement and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients nor for providing advice to any other person in relation to the Acquisition, the content of this announcement or any other matters referred to in this announcement.
END
Energy Revolution: A Global Outlook
Read the full report [PDF]
The global energy revolution
As a contribution to COP24, this report informs the debate on decarbonising the global energy system, evaluating how rapidly nations are transforming their energy systems, and what lessons can be learned from the leading countries across five energy sectors.
It was commissioned by power utility Drax Group, and delivered independently by researchers from Imperial College London and E4tech.
Clean power
- Several countries have lowered the carbon content of their electricity by 100 g/kWh over the last decade. The UK is alone in achieving more than
double this pace, prompted by strong carbon pricing. - China is cleaning up its power sector faster than most of Europe, however several Asian countries are moving towards higher-carbon electricity.
- Germany has added nearly 1 kW of renewable capacity per person over the last decade. Northern Europe leads the way, followed by Japan, the US and China. In absolute terms, China has 2.5 times more renewable capacity than the US.
Fossil fuels
- Two-fifths of the world’s electricity comes from coal. The share of coal generation is a key driver for the best and worst performing countries in clean power.
- Coal’s share of electricity generation has fallen by one-fifth in the US and one-sixth in China over the last decade. Denmark and the UK are leading the way. Some major Asian nations are back-sliding.
- Many European citizens pay out $100 per person per year in fossil fuel subsidies, substantially more than in the US or China. These subsidies are growing in more countries than they are falling.
Electric vehicles
- In ten countries, more than 1 in 50 new vehicles sold are now electric. China is pushing ahead with nearly 1 in 25 new vehicles being electric and Norway is in a league of its own with 1 in 2 new vehicles now electric, thanks to strong subsidies and wealthy consumers.
- There are now over 4.5 million electric vehicles worldwide. Two thirds of these are battery electric, one third are plug-in hybrids. China and the US together have two-thirds of the world’s electric vehicles and half of the 300,000 charging points.
Carbon capture and storage
- Sufficient storage capacity has been identified for global CCS roll-out to meet climate targets, but large-scale CO2 capture only exists in 6 countries.
- Worldwide, 5 kg of CO2 can be captured per person per year. The planned pipeline of CCS facilities will double this, but much greater scale-up is needed as this represents only one-thousandth of the global average person’s carbon footprint of 5 tonnes per year.
Efficiency
- Global progress on energy intensity is mixed, as some countries improve efficiency, while others increase consumption as their population become wealthier.
- Residential and transport changes over the last decade are mostly linked to the global recession and technological improvements, rather than behavioural shift.
- BRICS countries consume the most energy per $ of output from industry. This is linked to the composition of their industry sectors (i.e. greater manufacturing and mining activity compared to construction and agriculture).
continued … [View PDF]
I. Staffell, M. Jansen, A. Chase, E. Cotton and C. Lewis (2018). Energy Revolution: A Global Outlook. Drax: Selby.
