Slide 1: 2024 Full Year Results
2024 Full Year Results 27 February 2025
Slide 2: Presenters
Presenters Will Gardiner Chief Executive Officer Andy Skelton Chief Financial Officer 2
Slide 3: Our Purpose, Our People
Our Purpose To enable a zero carbon, lower cost energy future Our People Valued members on a winning team with a worthwhile mission 3
Slide 4: Strong Performance in 2024, Increasing Visibility on Long-term Outlook
Strong Performance in 2024, Increasing Visibility on Long-term Outlook Strong operational and financial performance in 2024, with growing returns to shareholders • >35% improvement in Total Recordable Injury Rate (2024: 0.24, 2023: 0.38) • >25% increase in generation • 5% growth in Adj. EBITDA drive
Slide 5: Well Positioned for Growth and Value Creation
Well Positioned for Growth and Value Creation Asset portfolio and developments aligned to energy security and transition to net zero 1 FlexGen & Energy 2 Pellet Production 3 Pellet BioGen 4 Investment Solutions Production Opportunities UK portfolio North American portfolio Drax Power Station FlexGen
Slide 6: Biomass Generation – Low-carbon Dispatchable CfD (Apr-27 to Mar-31)
Biomass Generation – Low-carbon Dispatchable CfD (Apr-27 to Mar-31) A CfD scheme that supports energy security, value for money and sustainability Low-carbon dispatchable CfD heads of terms Illustration of low-carbon dispatchable CfD • 6TWh pa of CfD-backed generation (eq. of c.0.8GW) • 4-year term
Slide 7: Launch of New Sustainability Framework
Launch of New Sustainability Framework New Sustainability Framework sets out actions Drax is taking to help decarbonise society, protect and enhance nature, and support the people who work with and alongside us Actions across three pillars • Climate positive • Nature positive • People positive 7
Slide 8: Financial & Operational Review
Financial & Operational Review Strong financial and operational performance, supporting increased returns to shareholders Strengthened balance sheet, >£0.7bn of new debt with extended maturities
Slide 9: Financial Summary
Financial Summary Strong financial and operational performance Total Cash and Cash Generated from Net Debt(3) Adj. Committed Facilities Operations £992m / 0.9x EBITDA(1/2) £806m £1,135m (2023: £1,220m / 1.2x) (2023: £639m) (2023: £1,111m) £1,064m (2023: £1,009m) Adj. Basic Earnings Per Share Expecte
Slide 10: Performance by Business
Performance by Business 5% growth in Adj. EBITDA driven by increased levels of renewable generation and Pellet Production FlexGen & Pellet Biomass Investment 2024 Adj. EBITDA £m 1 Energy 2 Production 3 Generation 4 Opportunities Total Solutions Pumped Storage & Hydro 138 - - - 138 Energy Solutions –
Slide 11: FlexGen & Energy Solutions
1 FlexGen & Energy Solutions Targeting post 2027 recurring Adj. EBITDA of >£250m pa 1.5GW portfolio of pumped storage, hydro and OCGTs Illustrative Adj. EBITDA aligned with post 2027 target (£m) Pumped storage and hydro 400 • System support, ancillary services, renewables and Capacity Market agreeme
Slide 12: FlexGen & Energy Solutions
1 FlexGen 1 & Energy Solutions Capacity Market agreements provide strong underpin for FlexGen earnings c.£595m(1) of agreements in place Capacity Market agreements profile and illustration (£m) 100 Asset Payment period Value £m Pumped storage 1-year agreements (2025-2028) 69 90 Pumped storage 15-yea
Slide 13: Pellet Production
2 Pellet Production Improved output and Adj. EBITDA in 2024 2022 2023 2024 Strong operational and financial performance • Record production – 4Mt, incl. 130kt Aliceville expansion Production (Mt) 3.9 3.8 4.0 • Increased balance of own-use volumes vs lower margin legacy sales to third-parties Product
Slide 14: Biomass Generation
3 Biomass Generation >£1bn of estimated post-tax operating cash flows 2025 to 2027 Contracted power sales (24 Feb 2025) 2025 2026 2027 Net RO, hydro and gas (TWh)(2) 10.6 8.2 1.4 Average achieved £ per MWh(3) 108.8 76.8 78.4 2025 to 2027: CfD (TWh)(4) 3.1 - - Strong forward power hedges Forward powe
Slide 15: Balance Sheet
Balance Sheet Strong balance sheet and liquidity 0.9x Net debt to EBITDA Balance of maturities weighted to 2029-2030 Refinancing activities in 2024 As at December 2024 (£m) • £0.7bn of new debt with maturities 2027-2029 1,000 • £0.9bn of shorter dated maturities repaid 800 600 Liquidity and working
Slide 16: Capital Investment
Capital Investment Investment in core assets and strategy 2024 2025 Key areas Actual £m Estimate £m Growth OCGTs, pellet plants and enhancement projects 212 ~90 Maintenance Includes major planned outages 83 ~70 Other Health, safety, environment and IT 37 ~40 Total 332 180-220 2024 • Growth – OCGTs,
Slide 17: Capital Allocation Policy
Capital Allocation Policy Disciplined approach to capital allocation to support opportunities for growth and value creation Maintain strong balance sheet and credit rating • 0.9x Net debt to Adj. EBITDA (Dec-24) Invest in core business • Invest in asset base to support current and future cash flows
Slide 18: Investment Opportunities
Investment Opportunities Investment in existing asset base and development of options for short, medium and long-term growth and value creation
Slide 19: Investment Opportunities
Investment Opportunities Development of investment opportunities aligned with energy security and transition to net zero Short-term Medium-term Long-term 2025 2025-2030 2030 onwards Capital returns FlexGen FlexGen • £300m share buyback, c.£150m complete • 40MW expansion of Cruachan • Incl. Cruachan
Slide 20: FlexGen and Biomass Generation Aligned With Needs of UK Power System
FlexGen and Biomass Generation Aligned With Needs of UK Power System Changing system needs are driving demand for flexible generation and system support services Opportunities for Drax to create value by providing services when the system needs Offshore wind output (TWh) Hours of negative pricing Gr
Slide 21: FlexGen & Energy Solutions
1 FlexGen & Energy Solutions Existing and new opportunities to complement portfolio and enhance system support services capabilities Long duration storage Short duration storage Refurbishment and upgrade of Cruachan by 2027 Battery storage • 40MW upgrade • Evaluating opportunities for investment • c
Slide 22: Development of an Option for a Data Centre at Drax Power Station
3/4 Development of an Option for a Data Centre at Drax Power Station Potential long-term development of >1.2GW data centre Ongoing engagement with developers • Shortlist of potential data centre developers Drax-owned acreage • Targeting a signed MoU for commercial discussions and due diligence in 20
Slide 23: Pellet Production
2 Pellet Production Market development and Drax initiatives support long-term growth and value from biomass sales Demand growth from existing and new markets (Mt) Activities to support delivery of long-term target 70 Targeting 5Mt of production and sales with improved margins 60 Low-carbon dispatcha
Slide 24: Pellet Production – New Markets
2 Pellet Production – New Markets Sustainable Aviation Fuels Global growth estimates for SAF (bn gallons pa) Heads of terms with Pathway Energy • >1Mt of biomass to US SAF project (Texas) 6 • Close proximity to Drax production in US South 5 • Multi-year contract from 2029 4 • Additional opportunitie
Slide 25: Elimini – Drax's Carbon Removals Company
4 Elimini – Drax’s Carbon Removals Company Elimini’s ambition is to become the world’s leading carbon removals company Development programme aligned with purpose Drax Power Station • Evaluating carbon credit product desk • Targeting 8Mt of carbon removals from BECCS • Access wider CDR market and pre
Slide 26: Summary and Outlook
Summary and Outlook Delivering for shareholders • Strong operational performance, substantial and growing dividend, disciplined capital allocation and a significant share buyback Delivering for all stakeholders • Opportunities aligned to energy security, affordability and decarbonisation Strong busi
Slide 27: Full Year Results
2024 Full Year Results 27 February 2025
Slide 28: Appendices
Appendices 27 February 2025 drax
Slide 29: Safety
Safety Enhanced reporting and disclosure, opportunities to deliver further improvements Total Recordable Injury Rate (TRIR) 0.44 0.38 0.24 2022 2023 2024 Improving safety performance • Wider scope of reporting • Multi-year investment in training • Strengthened HSE reporting culture Opportunity for c
Slide 30: Sustainability
Sustainability Continuing development of sustainability Developments in 2024 • Full alignment to TCFD • TNFD voluntary reporting • SBTi – 2030 targets validated, validating 2040 targets • EU taxonomy report (voluntary basis) >70% of revenues eligible and aligned (2023) Sustainability accreditations
Slide 31: Group Income Statement
Group Income Statement 2024 2023(2) In £m Adj. Results Adjustments(1) Total Results Adj. Results Adjustments(1) Total Results Revenue 6,081 81 6,163 7,450 283 7,733 Cost of sales (4,130) 5 (4,125) (5,492) (83) (5,575) Electricity Generator Levy (161) - (161) (205) - (205) Gross profit 1,790 86 1,877
Slide 32: Generation – FlexGen and Biomass Generation
Generation – FlexGen and Biomass Generation In £m 2024 2023(1) 2024 2023(1) Revenue Generation Adj. EBITDA (£m) 951 933 Power sales 3,869 4,960 Biomass 814 703 System support and optimisation 197 343 Renewable certificate sales 747 1,286 Pumped storage and hydro 138 230 CfD income/(payment) 144 (63)
Slide 33: Energy Solutions
Energy Solutions Renewable power and energy solutions I&C In £m 2024 2023 • Maintaining margin in line with 2023, some reduction in volume • Development of Energy Solutions business including system support services Revenue 3,786 4,958 via demand response, and electric vehicle services following acq
Slide 34: Pellet Production
Pellet Production Improved production and margin Good progress in 2024 In £m 2024 2023 • Higher production output (2024: 4.0Mt, 2023: 3.8Mt) Revenue 942 822 • Increased EBITDA per tonne produced Cost of sales (562) (512) Gross profit 380 311 Operating costs (237) (222) Adj. EBITDA 143 89 Production
Slide 35: Group Cash Flow Statement
Group Cash Flow Statement In £m 2024 2023 Adj. EBITDA 1,064 1,009 Working capital (excluding collateral) 38 (47) Collateral 84 155 Other (51) (6) Cash generated from operations 1,135 1,111 Debt service and other interest (82) (95) Corporation tax (194) (180) Net cash from operating activities 860 83
Slide 36: Working Capital Inflow in 2027
1 Working Capital Inflow in 2027 c.£0.5bn benefit from end of Renewable Obligation scheme at Drax Power Station in 2027 Illustrative Generation cash flow from ROCs Renewable Obligation 2025 2026 2027 • Renewable Obligation (RO) – requirement for energy suppliers to source a proportion of their energ
Slide 37: FlexGen and Biomass Generation – Long-term Indicators
1 FlexGen and Biomass Generation – Long-term Indicators UK Gov. net zero targets will require major increase in renewables, system support and carbon removals Increase in renewables drives long-term value from FlexGen and Biomass Generation c.2x increase in demand for power (TWh) Significant increas
Slide 38: Drax UK Portfolio
Drax UK Portfolio Flexible, renewable generation, system support and energy solutions with opportunity for carbon removals FlexGen and Energy Solutions • 440MW pumped storage • 125MW hydro • 900MW OCGTs • Large I&C book Pumped storage Pumped storage expansion Biomass Generation Hydro • 2.6GW OCGTs B
Slide 39: Power Generation and System Support Services
Power Generation and System Support Services Drax portfolio provides a wide range of system support services Drax portfolio Pumped Hydro Biomass OCGTs Batteries CCGTs Nuclear Wind Solar storage Power Power Yes Yes Yes Yes Partial Yes Yes Yes Yes generation Renewable Renewable Yes Yes Yes No Partial
Slide 40: Merchant Forward Commodity Prices
Merchant Forward Commodity Prices Baseload Power Price (£/MWh) Peak Power Price (£/MWh) 200 280 240 160 200 120 160 80 120 80 40 40 0 0 Dec-22 Apr-23 Aug-23 Dec-23 May-24 Sep-24 Jan-25 Dec-22 Apr-23 Aug-23 Dec-23 May-24 Sep-24 Jan-25 SUM-25 WIN-25 SUM-26 WIN-26 SUM-27 SUM-25 WIN-25 SUM-26 WIN-26 SUM
Slide 41: Merchant Carbon Prices
Merchant Carbon Prices UKA Carbon (£/t) EU ETS Carbon (€/t) 120 120 100 100 80 80 60 60 40 40 20 20 0 0 Dec-22 Mar-23 Jul-23 Oct-23 Feb-24 Jun-24 Sep-24 Jan-25 Dec-22 Mar-23 Jul-23 Oct-23 Feb-24 Jun-24 Sep-24 Jan-25 Dec-25 Dec-26 Dec-27 Dec-25 Dec-26 Dec-27 Source: ICE 41
Slide 42: Forward Looking Statements
Forward Looking Statements This announcement may contain certain statements, expectations, statistics, projections, and other information that are, or may be, forward looking. The accuracy and completeness of all such statements, including, without limitation, statements regarding the future financi
Slide 43: Full Year Results
2024 Full Year Results 27 February 2025