Drax Group PLC ADR (LSE:DRX) said Thursday that it anticipates its adjusted EBITDA for full-year 2025 will come in near the top of analyst expectations, supported by strong operational performance across the business.
The company noted that current analyst consensus places adjusted EBITDA for 2025 at £902 million, within a range of £892 million to £909 million as of December 4.
Looking further ahead, Drax is maintaining its target of generating £600–700 million in adjusted EBITDA annually after 2027. It also expects its existing operations to produce roughly £3 billion in free cash flow between 2025 and 2031—a level that would underpin more than £1 billion in shareholder returns and up to £2 billion in growth-focused investments.
The group has already locked in about £2.3 billion in contracted forward power sales between 2025 and Q1 2027 tied to its Renewables Obligation biomass, pumped storage, and hydro generation assets. For 2025 and 2026, Renewables Obligation output is fully hedged, with over £1 billion in related ROCs.
Drax continues to advance its growth pipeline in flexible generation, including gigawatt-scale opportunities in battery energy storage. In October, the company struck a deal to acquire three BESS projects totaling 260MW, with staged payments of £157.2 million scheduled between 2025 and 2028.
The company is also assessing ways to unlock additional value at its Drax Power Station site. This includes preparing a planning submission for a potential 100MW data centre that could be operational in 2027, while longer-term evaluations explore options for more than 1GW of total data centre capacity.
“It is vital that the UK maintains its energy security and delivers affordable routes to decarbonisation into the 2030s and beyond,” said Drax Group CEO Will Gardiner. “By 2050, demand for power is expected to double, while secure gas generation reduces and intermittent renewable generation increases, meaning more dispatchable and reliable generation will be required.”
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