Drax Group (LON:DRX) Announces Earnings Results

Drax Group (LON:DRX) issued its quarterly earnings results on Thursday. The company reported GBX 29.80 earnings per share for the quarter, Digital Look Earnings reports. Drax Group had a net margin of 1.35% and a return on equity of 3.94%.

Here are the key takeaways from Drax Group’s conference call:

• H1 adjusted EBITDA was £279 million, while net debt remained modest at £1.025 billion, or 1.3x last-twelve-month EBITDA. Management proposed an 11% increase in the full-year dividend to 32.2 pence per share and has returned £47 million through share buybacks year to date.
• Drax raised its 2029 EBITDA target to £650 million–£800 million, with the £50 million–£100 million increase attributed to its battery energy storage investments. More than 700 MW of owned and tolled BESS capacity has been committed, although the upper end of the range depends on market volatility and operating conditions.
• The proposed acquisition of Bluefield Solar Income Fund is expected to complete after a court hearing on July 31, following 99% shareholder approval. The deal would add roughly 900 MW of operational wind and solar assets, £130 million of 2025 EBITDA, and a 2.9 GW development pipeline, diversifying Drax’s earnings with contracted renewable cash flows.
• Hirwaun’s 300 MW gas peaking plant began operations in May and operated for about 440 hours in grid-stabilization mode during June, demonstrating demand for flexible generation. However, sister plants Millbrook and Progress have been delayed by grid-connection issues and are now expected to commission from late 2026 through 2027.
• Drax is progressing plans for a data center at its power-station site, initially targeting a 100 MW planning application in the second half of 2026, followed by larger behind-the-meter phases. Management said discussions remain ongoing and did not indicate that an offtake agreement is imminent; the project also requires consideration of the station’s continuing security-of-supply role.

Drax Group Stock Down 1.9%

Shares of DRX stock traded down GBX 14.50 during trading on Thursday, reaching GBX 745. The company’s stock had a trading volume of 1,109,114 shares, compared to its average volume of 7,335,813. Drax Group has a 1-year low of GBX 613.90 and a 1-year high of GBX 937.50. The stock’s 50-day moving average price is GBX 776.33 and its 200 day moving average price is GBX 841.72. The company has a market capitalization of £2.51 billion, a price-to-earnings ratio of 36.88, a P/E/G ratio of 0.10 and a beta of 0.62. The company has a debt-to-equity ratio of 62.90, a current ratio of 1.07 and a quick ratio of 0.32.

Wall Street Analysts Forecast Growth

A number of brokerages have recently commented on DRX. Citigroup reduced their target price on shares of Drax Group from GBX 9,230 to GBX 8,160 and set a “neutral” rating for the company in a research report on Friday, June 5th. Jefferies Financial Group reissued a “buy” rating and issued a GBX 1,120 target price on shares of Drax Group in a research note on Tuesday, June 2nd. Finally, Royal Bank Of Canada reaffirmed an “outperform” rating and issued a GBX 1,000 price target on shares of Drax Group in a report on Wednesday, May 6th. Two analysts have rated the stock with a Buy rating and one has assigned a Hold rating to the stock. According to data from MarketBeat, the stock has an average rating of “Moderate Buy” and a consensus target price of GBX 3,426.67.

About Drax Group

Drax Group plc, together with its subsidiaries, engages in renewable power generation in the United Kingdom. It operates through three segments: Pellet Production, Generation, and Customers. The Pellet Production segment produces and sells biomass pellets. The Generation segment provides renewable, dispatchable power, and system support services to the electricity grid. The Customers segment supplies electricity and gas to non-domestic customers. The company owns and operates Drax Power Station located in Selby, North Yorkshire; Cruachan Power Station, a pumped storage hydro station, with an installed capacity of 440 megawatts (MW) located in Argyll and Bute; and Lanark and Galloway hydro-electric power stations with an installed capacity of 126 MW located in southwest Scotland.