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Drax has announced it expects to beat city profit forecasts this year, thanks to a strong demand for its power and an "encouraging performance" from its first biomass conversion unit.
In its interim management statement published today, the coal-fired power station owner said it anticipated that full year EBITDA and underlying earnings per share for 2013 would be “materially ahead” of current market consensus forecasts, which currently stand at £203 million.
Drax said trading conditions in the market had continued to be positive since it published its half year results on 30 July.
“We have also benefited from solid operating performance from our coal generating units and the performance of our first unit converted to burn biomass in place of coal has been encouraging.
“In addition, commissioning of our new biomass delivery, storage and distribution systems is progressing very well,” said the company.
The company has also strengthened its contracted position, including additional power sales of 3.4TWh for 2014 compared with the position reported in its half year results.
According to Drax, it has made “good progress” in its on-going transformation to a predominantly biomass-fuelled electricity generator.
“The commissioning of the new on-site facilities for the first converted unit is on schedule to be complete by year end and we remain on track to convert our second unit in the second quarter of 2014. Capital investment is on schedule and budget,” it said.
At 10:35AM GMT, Drax’s shares were trading at 661 pence, up 3.8 per cent from the previous close.
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