AGM Statement

RNS Number : 0546D

Drax Group PLC

24 April 2013

 



24 April 2013

Drax Group plc

("Drax" or the "Company")

Symbol: DRX

AGM Statement

Drax holds its Annual General Meeting at 11:30am today at The Grocers' Hall, Princes Street, London.  At this meeting Charles Berry, Chairman of Drax, will make the following comments:

"Let me first say one or two things by way of introduction in respect of the Company's performance in 2012, our strategic focus, returns to you, our shareholders, and the composition of the Board.

Our principal performance indicators and operational achievements for 2012 are summarised on the screen, but let me just put these into context. Underpinned by continued strength in operations the business performed well and delivered profits in line with city expectations.

It was a year of record output for Drax Power Station and we benefited from the high availability and reliability of our generating plant. I should add that amid higher than ever output levels and significant project and construction activity at the power station site, our safety statistics for the year remained industry-leading.

Haven Power, our electricity retail company, delivered significant growth in a highly competitive market place with a 60% increase in sales of power to business customers. Excellence in customer service is how we set out to differentiate ourselves in the retail market and once again we were pleased to receive recognition of that through an external survey.

But when I reflect on 2012, I think that the year was particularly notable for the progress we made on our journey towards becoming a predominantly biomass-fuelled generator. We now have the mandate, means and expertise to transform your company.

We have the mandate from the Government, which last year delivered an appropriate regulatory framework for electricity generation from biomass.

We have the means through a refinancing which has provided the funds needed to transform the business. You may have seen that earlier today we announced the completion of our funding arrangements, with a loan for £75m underwritten by Infrastructure UK. Infrastructure UK was established by HM Treasury to provide security for major infrastructure projects in the UK. We very much welcome the participation of HM Treasury, which complements support from the Department of Business Innovation and Skills secured last year through a loan from the Green Investment Bank.

Finally, we have the expertise, developed from a decade spent understanding all aspects of biomass as a fuel for electricity generation.

We've now moved firmly into execution of our plans, and I'm delighted to confirm that at the beginning of this month our first converted unit was brought safely into service burning sustainable biomass in place of coal. The unit is currently going through a phased commissioning process, but we've been very pleased with its performance so far, which has met all of our expectations.

As you know, we've long believed that generating electricity from sustainable biomass has great potential and that it should play an important role as a low carbon, cost effective and reliable renewable. It is, without question, the only renewable complement to intermittent and inflexible forms of power and we're determined to be a leading provider of this attractive renewable power in the UK. Thanks to our progress on all fronts last year, that is now becoming a reality.

Turning now to returns to our shareholders, as you're aware, a resolution is to be proposed to the meeting for payment of a final dividend of 10.9 pence per share. If the resolution is passed, this equates to returning a further £44 million to shareholders in May.  When added to the dividends paid last October this brings the total return to shareholders in respect of 2012 to £97 million.

The final comment I'd like to make is about the composition of the Board. During the year, the Nominations Committee considered the composition of the Board and concluded that it was an appropriate time to appoint an additional non-executive director. I was therefore delighted to welcome Melanie Gee to the Board with effect from 1 January this year. Melanie brings with her a wealth of experience in the financial markets.

I'm sorry to say that Tim Barker will step down from the Board at the conclusion of this AGM. Tim is bowing out after nine years of service, joining us at a formative time for the Company and assisting us through the Listing process.

On behalf of the Board I'd like to thank Tim his time, commitment and enormous contribution to the Group, as a Board member, Chairman of the Remuneration Committee and as Senior Independent Director.  He leaves us with our very best and sincere wishes for his future.

The Board has appointed David Lindsell to take over from Tim as Senior Independent Director and Tony Thorne as Chairman of the Remuneration Committee."

Enquires:

Investor Relations

Michael Scott

[phone]

Media 

Melanie Wedgbury         

[phone]

Website: www.draxgroup.plc.uk

Notes:

(1)  The principal performance indicators and operational achievements for 2012 which were  "summarised on the screen" were as follows:

During 2012:

®  Total revenue from Generation was £1,780 million

(2011: £1,836 million)

®  Gross Profit was £511 million

      (2011: £501 million)

®  EBITDA was £298 million

      (2011: £334 million)

®  Underlying earnings - 52 pence per share

      (2011: 56 pence per share)

®  Net cash was £311 million

      (2011: £225 million)

®  Carbon dioxide emissions - 784 tonnes per GWh

      (2011: 760 tonnes per GWh)

®  High commercial despatch with a load factor of 82%

      (2011: 80%)

®  Total recordable injury rate was 0.17

      (2011: 0.10)

 

END

 

 

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