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British power producer Drax reports fall in earnings after outages

[LONDON] British power producer Drax Group Plc reported a 16 percent fall in first-half earnings on Tuesday as outages curbed electricity generation at its power plants.

Earnings before interest, tax, depreciation and amortisation (EBITDA) fell to 102 million pounds (S$182.3 million) for the six months to June 30, the company said.

Drax, which generates about 6 percent of Britain's electricity, has converted three of its previously coal-fired units to using biomass wood pellets, often made from compressed sawdust.

A fourth unit conversion will be complete by the end of the year.

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A rail loading outage restricted deliveries of pellets at the beginning of the year, leading to lower power generation at two of the company's biomass units.

Electricity generation was also curbed by a generation outage at one of the biomass units in February, the company said.

Overall electricity output was down by 17 per cent compared with the first half of 2017, to 8.9 terawatt hours (TWh).

The company said its full-year EBITDA expectations were unchanged and upped its interim dividend to 22.4 million pounds, or 5.6 pence per share, compared with 4.9 in the first half of 2017.

"We remain focused on safe and efficient operations and returns to shareholders and expect to declare a full-year dividend of 56 pounds million for 2018," Will Gardiner, Drax chief executive said in a statement.

REUTERS