FY22 results – EBITDA beats expectations Adjusted EBITDA was £731m, up 84% vs. FY21A and above our estimate of £712m and company-collated consensus of £699m. EPS of 85.1p, up 221% vs. FY21A (INVe 89.7p, consensus 83.1p). Dividend of 21p, up 11.7% vs. FY21A (INVe 21.0p, consensus 21.0p). Net debt of £1,206m was above our estimate of £998m due to a £234m collateral outflow. At a divisional level, generation posted EBITDA of £696m (INVe £667m), pellet production posted EBITDA of £134m (INVe £121m), and B2B posted EBITDA of £26m (INVe £34m). Within generation, there was a strong performance in pumped storage/hydro, up 151% to £171m, underscoring how flexibility is increasingly important in a system with more volatility and intermittency. A presentation is already available (HERE) and a webcast will be held at 9am (LINK). Hedging advances, Drax indicates underpins expectation Drax has now hedged 12.4TWh of FY23 ROC output at £158.1/MWh, and 9TWh for FY24 at £149.2/MWh. At 8th December, hedged ROC output stood at 11.2TWh at £154.4/MWh (FY23), and 7.4TWh at £154.6/MWh (FY24). Drax is suggesting that forward selling of pumped storage and hydro underpins expectations, and pointing out that EBITDA consensus is £1,147m with a range of £1,014-1,232m. We are top of the range. Company-collated consensus for FY23 stands at 111.0p (EPS) and 23.1p (DPS). Pellets, BECCS, Cruachan, OCGTs FY23 capex guided to £570-630m, o/w £120m maintenance, £30m enhancements; £430m strategic (>£200m OCGT and >£100m pellet plant developments). Capital allocation remains focussed on the core business and strategy, including new biomass pellet plants, the development of options for BECCS, and the expansion of the pumped storage power station at Cruachan.