Drax (LSE:DRX) expects adjusted EBITDA for 2026 to be around the upper end of analyst consensus, following its operational performance in July and August and the contribution from its recently acquired Bluefield Solar Income Fund (BSIF).
The UK power generation group said its full-year outlook remains dependent on continued operational performance.
As of 4 September, analyst consensus for 2026 adjusted EBITDA stood at £698 million, with estimates ranging from £680 million to £711 million.
Drax reported that its generation assets contributed to meeting electricity demand during the UK’s summer heatwave, while system-support activities also contributed to performance during the period.
The updated earnings outlook includes the contribution from BSIF, which Drax acquired for £561 million in a transaction completed on 31 July 2026.
The acquisition added approximately 0.9 gigawatts (GW) of operational solar and onshore wind capacity, alongside a 2.9GW development pipeline comprising around 2.0GW of battery storage and 0.9GW of solar projects.
Following the transaction, Drax’s total capacity under management increased to approximately 6.1GW.
The company said integration of the acquired business was progressing and expects to generate additional benefits by applying its existing trading, asset optimisation and route-to-market capabilities to the BSIF portfolio.
Drax also anticipates cost savings from using its existing operating platform and reducing market-access and balancing costs.
The group maintained its 2026 capital expenditure guidance of £210 million to £250 million, including investment associated with BSIF. It noted that the development of additional solar capacity could require further capital expenditure.
Following the acquisition, Drax expects its net debt-to-adjusted EBITDA ratio to remain above its long-term target of approximately 2 times during 2026.
Management anticipates that leverage will return towards the target level by the end of 2027.
The company also reported more than £1 billion of contracted forward power sales covering 2026 to 2028, together with more than £800 million of associated renewable obligation certificates.
Drax’s revised earnings outlook reflects its recent operational performance and the inclusion of BSIF, while its capital expenditure guidance remains unchanged.
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