ADNOC Distribution has announced its financial results for the second quarter of 2024, reporting a 12.9 percent year-on-year growth in net profit to $170 million. The company also saw a 15 percent annual increase in EBITDA to $267 million. Excluding the UAE corporate tax, net profit would have increased by 24.5 percent to $187 million.
ADNOC Distribution attributed the strong financial performance to higher fuel volumes, greater contributions from international operations, and growth in the non-fuel retail business.
Non-fuel retail business booms
ADNOC Distribution’s non-fuel retail gross profit increased by 13.5 percent annually in Q2 2024 to $56 million due to an expansion in the car wash business as well as larger convenience store offerings and other car services.
Growth was further supported by higher inventory gains and significant progress in cost optimization, with $10 million in like-for-like OPEX savings in H1 2024.
“The strong Q2 2024 results, marked by double-digit EBITDA and net profit growth, highlight our effective pursuit of the company’s five-year strategy, focusing on domestic growth, international platforms, future-proofing the business, and investing in convenience and mobility,” stated Bader Saeed Al Lamki, CEO of ADNOC Distribution.
Service, EV station expansion
ADNOC Distribution also added 10 new service stations in H1 2024, bringing the total to 847 across UAE, KSA and Egypt. The company is steadily progressing towards its target of adding 15 to 20 stations throughout 2024.
In H1 2024, the company also continued to expand its electric vehicle (EV) charging network. It made significant progress towards achieving a key operational milestone by opening a pioneering Mobility Hub in Masdar City and doubling its network of fast and super-fast charging points to more than 100. This expansion falls in line with its target to reach 150 to 200 by the end of the year.
Cash flow rises seven times
ADNOC Distribution generated a strong free cash flow of $330 million in Q2 2024, a 7x increase from Q2 2023. In H1 2024, the company’s free cash flow stood at $488 million, a 46.7 percent annual increase. In addition, it maintained a robust balance sheet with a net debt-to-EBITDA ratio of 0.53x as of June 30, 2024.
ADNOC Distribution expects to distribute a dividend of $350 million for H1 in October 2024, subject to the discretion of the board of directors. This falls in line with its five-year dividend policy that sets an annual dividend of $700 million (20.57 fils per share), or a minimum 75 percent of net profit, whichever is higher.
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