Drax Group PLC on Thursday said it believed to play a long-term role in the UK energy market as it reported significantly higher profit on the back of lower sales costs and higher revenue.

The Yorkshire, England-based electricity company said profit multiplied in 2023 to £796 million from £78 million a year prior.

This is despite Drax reporting a £204.6 million cost in windfall tax for 2023, up from none in 2022.

Revenue rose 4.5% to £8.13 billion from £7.78 billion. Cost of sales meanwhile decreased 12% to £5.97 billion from £6.75 billion. Operating and administrative expenses increased 31% to £711.7 million from £542.8 million.

The company declared a final dividend of 13.9 pence per share, up 10% from 12.6p a year ago. This brings the total dividend to 23.1p, up 10% from 21.0p.

Meanwhile, London-based commercial property developer Land Securities Group PLC announced that their Chief Financial Officer Vanessa Simms will resign from her position as a non-executive director of Drax on June 18.

Looking ahead, Chief Executive Officer Will Gardiner said: ‘We are continuing to play an important role in supporting energy security in the UK. We are using our supply chain and dispatchable, renewable generation portfolio to provide large volumes of reliable renewable power and system support services. In this context the strategic importance of our portfolio and its contribution to the UK power system is clear. We believe we will have a long-term role to play as the UK manages the need to decarbonise whilst maintaining energy security.’

Drax shares rose 6.4% to 445.50 pence each on Thursday morning in London.

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