Drax Group (DRX) H1 2026 earnings summary

Executive summary

• Delivered strong H1 2026 performance, providing 6% of UK power and 10% of UK renewables, with safe and efficient operations.

• Commenced operations at Hirwaun Power Station (300 MW), expanding portfolio to 6.1 GW, with further growth to 7.4 GW by 2029 targeted; Cruachan turbine upgrade progressing.

• Announced and nearly completed acquisition of Bluefield Solar Income Fund (BSIF), adding 900 MW of solar and wind assets and a 2.9 GW development pipeline.

• Upgraded 2029 EBITDA target to GBP 650m–800m, excluding BSIF, driven by BESS and flexible generation investments.

• Maintained strong balance sheet and disciplined capital allocation, supporting growth and shareholder returns.

Financial highlights

• H1 2026 adjusted EBITDA of GBP 279m, down year-over-year due to lower achieved forward power prices and outages.

• Adjusted EPS of GBP 0.298, reflecting lower EBITDA and non-cash FX movements, partially offset by lower D&A.

• Net debt at GBP 1.025bn, 1.3x LTM EBITDA, well below long-term target of 2x.

• Cash and committed facilities of GBP 630m, supporting growth plans.

• Proposed full-year dividend of GBP 0.322/share, up 11% year-over-year; GBP 47m–48m returned via share buybacks YTD.

Outlook and guidance

• Upgraded 2029 EBITDA guidance to GBP 650m–800m, driven by BESS and flexible generation, excluding BSIF.

• BSIF expected to add GBP 130m EBITDA (2025), with further details to be provided in September.

• Targeting 7.4 GW under management by 2029, with potential to reach 12 GW including pipeline and options.

• Committed to sustainable and growing dividends, with 11% CAGR since 2017.

• Ongoing cost reduction initiatives targeting over GBP 150m annual savings from 2027 vs. 2024 base.