Drax Group (LSE:DRX) shares rose 2.7% to 890p after a trading update saying full‑year 2026 Adj. EBITDA is expected in line with analyst consensus.
It said this reflects good operational performance across its generation, pumped storage and pellet production businesses.
Drax, a UK power generator and biomass pellet producer supporting energy security, added that it has completed the acquisition of Flexitricity and is progressing the commissioning of its first OCGT unit at Hirwaun while building a GW‑scale battery energy storage (BESS) pipeline from recent asset and tolling commitments of c.£500 million.
As at 28 April, Drax had over £1 billion of contracted forward power sales for 2026-28, with RO generation fully hedged for 2026 and an incremental 0.2TWh added at an average price of £200.9/MWh.
Thursday's update highlighted provisional Capacity Market T‑4 wins totalling 434MW (de‑rated 399MW) for delivery year 2029/30 at £27/kW/year and said Drax has c.£650 million of index‑linked Capacity Market agreements extending contracted earnings visibility to 2043. On regulation, Drax noted the UK Government’s intention to remove the Carbon Price Support from April 2028 and the extension and increase of the Electricity Generator Levy, but said it does not expect to pay EGL in 2026 or for it to affect 2026 Adj. EBITDA.
It said its £450 million share buyback programme remains in place, with the first £75 million tranche completed in April and a second £75 million tranche to commence in May, and that a final dividend of 17.4p per share is subject to shareholder approval at today’s AGM.
"We are excited about the potential opportunities to invest further to help the country meet its growing energy needs," Will Gardiner, Chief Executive Officer, said.
