Investors in Drax were given a jolt this year when the energy company put its dividend policy under review, prompting analysts to speculate about lower payouts.
In a capital markets day presentation at the Connaught hotel in Mayfair yesterday, Drax lifted the lid on how it was managing the long-term shift out of coal-powered electricity generation into cleaner energy.
Drax intends to return £50 million to investors this year, and use that level as a floor from which it expects to boost the dividend in future, reflecting what it calls a more stable earnings and cashflow outlook as well as its investment needs.
Alongside this guidance, Drax also outlined plans to generate earnings before interest, tax, depreciation and amortisation of more than £425 million by