Drax Group Plc · LSE:DRX
Drax — Investor Day (November 2019)
12 slides from Drax's investor day presentation, Nov 19, 2019
Slide 1: Financial Update
Financial Update Andy Skelton, CFO 19 November 2019
Slide 2: Strong Financial Characteristics
Strong Financial Characteristics Aligned with UK’s long-term energy objectives －Reduced business risk – multi-site, multi-technology asset base High degree of earnings visibility, －High proportion of non-commodity earnings – renewables, system support services and capacity reducing commodity exposur
Slide 3: Growing and Sustainable Cash Generation
Growing and Sustainable Cash Generation Supports leverage targets, investment activities and returns to shareholders £m Good growth in Adjusted EBITDA 2016-2019 £m Strong net cash from operating activities 400 300 300 200 200 315 311 250 100 191 197 100 229 140 0 0 2016 2017 2018 2019 2016 2017 2018
Slide 4: Biomass Generation Economics – Pre 2027
Biomass Generation Economics – Pre 2027 Expect to generate significantly higher Margin expansion drives significant increase in cash flows levels of earnings and cash － Indexation of ROC and CfD to 2027 － Capture value from lower biomass costs £/MWh ROC Peak Biomass Bark － ROC – focus on periods of
Slide 5: Biomass Economics – Post 2027
Biomass Economics – Post 2027 Continued need for biomass as part of 2050 net zero Characteristics of generation model(1) – Low-cost biomass generation Basic illustrative – Flexible operation targeted on periods of higher power price and demand – Provision of system support services assumptions suppo
Slide 6: Balance Sheet
Balance Sheet Long-term structures in place to support growth Refinancing of acquisition bridge facility complete Instrument Maturity Description Extended maturity profile 2024 to 2029 Infrastructure private 2024-2029 £375m – $200m fixed rate bond issue (completed May 2019) placement – £375m infrast
Slide 7: Clear Capital Allocation Policy
Clear Capital Allocation Policy Implemented in 2017, designed to support strategy Invest in core business £m Maintain credit rating 190 140 BB+/BBB- 182 170- 90 142 190 Maintain credit rating 40 Invest in core business 2017 Actual 2018 2019 FY19 guidance range Pay a sustainable and growing dividend
Slide 8: Summary
Summary Will Gardiner, CEO 19 November 2019
Slide 9: Summary: Drax has a clear purpose
Summary Drax has a clear purpose: to enable a zero carbon, lower cost energy future Drax has a clear strategy – To be the leading provider of power system stability – To give our customers control of their energy – To build a long-term future for sustainable biomass Over the last four years, Drax ha
Slide 10: Q&A
Q&A 19 November 2019
Slide 11: Directors, Executives and Senior Managers Joining Us Today
Directors, Executives and Senior Managers Joining Us Today Board Customers David Nussbaum – Senior Non-executive Director Paul Sheffield – Managing Director – Customers Biomass Gas Project Arabella Freeman – Director of Biomass Strategy Esa Heiskenan – EVP Capital Projects BECCS David Ball – Develop
Slide 12: Drax Capital Markets Day
Drax Capital Markets Day 19 November 2019