ADNOC Distribution’s board of directors has approved an interim dividend of AED1.285 billion ($350 million) for the first half of 2024, equivalent to 10.285 fils per share, underscoring the company’s commitment to delivering consistent and attractive returns to its shareholders.
The company noted that the deadline for purchasing shares to qualify for the interim dividend payment is September 26, 2024, with eligibility based on shareholders recorded in the share register on September 30, 2024.
The dividend announcement comes after ADNOC Distribution reported a 16 percent annual increase in earnings and a 7.7 percent year-on-year rise in net profit to $319 million (AED1.17 billion) in H1.
“ADNOC Distribution has demonstrated exceptional performance in H1 2024, driven by strong financial results and confidence in future growth,” stated Eng. Bader Saeed Al Lamki, CEO of ADNOC Distribution.
Full-year dividend to reach $700 million
ADNOC Distribution’s first-half dividend marks the first instalment of its target full-year 2024 dividend of $700 million (AED2.57 billion), equivalent to 20.57 fils per share. This aligns with ADNOC Distribution’s five-year dividend policy, which sets an annual dividend of $700 million or a minimum of 75 percent of net profits, whichever is higher, from 2024 to 2028, subject to board discretion and shareholder approval.
“The successful execution of our smart growth strategy reinforces the company’s attractive value proposition, while our healthy balance sheet and robust cash generation underpin future growth and shareholder returns,” Al Lamki added.
ADNOC Distribution will likely pay the second and final dividend for 2024 in April 2025, subject to the board’s recommendation and shareholder approval. The full-year 2024 dividend would offer a 5.6 percent annual dividend yield, based on the share price of AED3.67 as of September 20, 2024.
Company set for growth
ADNOC Distribution generated a free cash flow of $488 million (AED1.79 billion) in H1 2024, comfortably covering the interim dividend of $350 million. The company continued to maintain a strong financial position with a net debt-to-EBITDA ratio of 0.53x and liquidity of $1.7 billion (AED6.2 billion), including a cash position of $925 million (AED3.4 billion), positioning it favorably for future growth and shareholder value creation.
Since its IPO in 2017, ADNOC Distribution has delivered solid returns to shareholders through enhanced market value and consistent dividends. It will have paid a total of $4.4 billion (AED16.2 billion) in dividends since IPO, including the H1 2024 dividend.
With a record EBITDA of $1 billion in 2023, the company is on track to deliver on its growth commitments and is well-positioned for its next phase of strategic and accelerated growth.
Read: AD Ports Group signs agreements with two UAE banks to refinance $2.25 billion debt
Five-year growth strategy to boost shareholder value
In addition to the dividend policy, ADNOC Distribution launched a new five-year growth strategy earlier this year which focuses on domestic growth, international platforms, future-proofing the business, enhancing digital capabilities, and driving operational efficiencies. This strategy aims to position the company for long-term growth while continuing to deliver strong shareholder value.
“Our new strategy enables us to capture new market positions both at home and abroad, reinforcing our leadership and creating long-term value to sustain shareholder returns,” added Al Lamki.
ADNOC Distribution has reiterated its commitment to exploring growth opportunities in fuel and non-fuel retail, as well as new revenue streams emerging from the energy transition. The company is keen on expanding its new mobility solutions, including electric vehicle (EV) charging, while maintaining a strong focus on sustainability-driven initiatives.
As part of its initiatives to future-proof its business, ADNOC Distribution will also focus on growth and sustainability to support its primary goal of delivering long-term sustainable value to shareholders.
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