Proactive Investors - Drax Group (LON:DRX) penned a jump in operating profit during the half-year to June, though rising debt and lack of update on the energy generator’s UK investment plan saw shares tumble.
Despite recording a near-90% increase in operating profit to £392mln during the six months to June, shares in the FTSE 250-listed company fell by 2.4% on Thursday morning.
Rising interest payments saw the firm’s net debt increase by 14% to £1.27bn, while Thursday’s update gave little away in terms of plans to invest in its Yorkshire power station.
Having announced billions would be poured into bioenergy power production with carbon capture and storage (BECCS) in the US early this year, Drax reiterated similar plans for the UK were still on pause.
“We are excited about the opportunity for BECCS in the UK and are in formal discussions with the UK Government to facilitate the transition to BECCS at Drax Power Station by 2030,” boss Will Gardiner commented.
However, repeated calls from the generator that public support will be needed to fund the refurbishment of the Drax power plant seem yet to be met.
“UK BECCS investment [is] paused,” the company said, “subject to further clarity on support.”
Regardless, Drax did indeed enjoy growth during the period, as basic earnings per share more than doubled to 46p, with its dividend also being increased by 0.8p to 9.2p.
“In the first half of 2023, we delivered a strong system support and generation performance, providing dispatchable, renewable power for millions of UK homes and businesses,” Gardiner added.