Drax Group PLC on Thursday reported higher full-year revenue and profit on growth in its Pellet Production business and a strong Covid-19 recovery in its Customers segment, leading the firm to lift its shareholder payout.
In 2021, the Yorkshire-based power generation business swung to a pretax profit of £122 million from a loss at £235 million in 2020.
This was on revenue growth of 20% to £5.09 billion from £4.24 billion the year before.
This can be put down to ‘significant growth’ in Drax’s Pellet Production business, mostly due to the acquisition of Renewable Energy Inc in April, as well as a strong recovery from Covid-19 in its Customers business.
Drax proposed a final dividend 11.3 pence for 2021, up 9.7% from a final payout of 10.3p in the year prior.
Its total dividend for the year amounted to 18.8p, reflecting a 9.9% increase from 17.1p in 2020.
Going forward, Drax plans to continue to focus on its strategy to be a global leader in sustainable biomass pellets and negative emissions and a UK leader in dispatchable, renewable generation.
‘Through these strategic objectives, we expect to create opportunities for long-term international growth underpinned by strong cash generation and attractive returns for shareholders, and to deliver value for our other stakeholders,’ the company stated.
Drax noted that it is making ‘good progress’ in the delivery of its strategy and expects to play a major role in delivering the UK’s legally binding objective to achieve net zero carbon emissions by 2050 and support global efforts to reduce carbon emissions.
‘2021 was a transformational year for Drax as we became the world’s leading sustainable biomass generation and supply company,’ Chief Executive Will Gardiner said.
‘We have significantly advanced our plans for bioenergy with carbon capture and storage in the UK and globally. By 2030 we aim to deliver 12 million tonnes of negative emissions and lead the world in providing a critical technology which scientists agree is key to delivering the global transition to net zero.’
Shares were down 3.2% at 610.50 pence each on Thursday midday in London.
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