ADNOC Distribution today announced its financial results for the third quarter and the first nine months of 2024, reporting its highest-ever nine-month EBITDA of $790 million (AED2.90 billion) and underlying EBITDA of $721 million (AED2.65 billion), implying annual growth of 5.9 percent and 11.6 percent, respectively. Net profit for the period stood at $501 million.
In the first nine months of 2024, ADNOC Distribution’s free cash flow reached $537 million (AED1.97 billion), while maintaining a robust balance sheet with a net debt-to-EBITDA ratio of 0.56x as of September 30, 2024.
“ADNOC Distribution’s strong underlying financial performance is a testament to the company’s solid fundamentals and its ability to execute against strategic objectives. Across the first nine months of the year, we made steady progress in expanding our domestic retail presence and market share, while also seeing growing returns from our international expansion,” stated Bader Saeed Al Lamki, CEO of ADNOC Distribution.
Record high fuel volumes
This strong financial standing positions the company for future growth and attractive shareholder distributions. ADNOC Distribution attributes these achievements to strong retail and commercial performance, including the highest-ever nine-month fuel volumes, robust non-fuel retail (NFR) contributions, and cost efficiency improvements.
In the first nine months of 2024, ADNOC Distribution exceeded 11 billion liters in total fuel volumes, marking a 9.2 percent year-on-year increase, driven by network expansion, economic growth, and growing contributions from international operations.
Material like-for-like OPEX savings totaling $13 million (AED48 million) over the first nine months of 2024 also supported ADNOC Distribution’s EBITDA growth and strong free cash flow generation, placing the company on track to achieve $50 million (AED184 million) in OPEX savings between 2024 and 2028.
Company targets $700 million annual dividend
“To continue to unlock shareholder value, the company is pursuing AI, advanced digital technologies, and innovation-enabled growth across our entire value chain, engendering considerable OPEX savings and improvements to our industry-leading customer experience,” added Al Lamki.
ADNOC Distribution distributed the H1 2024 dividend of $350 million (AED1.285 billion) in October, in line with its five-year policy which expects the company to distribute an annual dividend of $700 million (AED2.57 billion), equivalent to 20.57 fils per share, or a minimum of 75 percent of net profit, whichever is higher, offering long-term visibility for shareholders.
ADNOC Distribution will pay the H2 2024 in April 2025, subject to the discretion of the board and approval of shareholders.
Growth across non-fuel operations
ADNOC Distribution’s non-fuel retail transactions also grew by 9.4 percent year-on-year during the period, with a 10.3 percent growth in Q3 alone. The convenience store conversion rate reached 25.5 percent over the nine-month period, the highest in five years, including 25.9 percent in Q3 2024.
ADNOC Distribution implemented key growth initiatives including expanding premium food and beverage offerings, enhancing car services, and optimizing real estate to strengthen the company’s position. Besides, ADNOC Voyager maintained its leading position as the UAE’s number one lubricant brand by market share, now available in 43 countries, up from 34 during the same time last year.
In the nine months to September, ADNOC Distribution also added more than 60 commercial retail tenants across its network, including new stores, restaurants, and car services, with plans to add another 20 by the end of the year. The company aims to double the number of property units occupied by top international and regional food and beverage brands by the end of 2025.
Service station expansion
ADNOC Distribution also added 19 new service stations in the first nine months of 2024, bringing the total to 855 across the UAE, KSA, and Egypt, achieving its full-year goal of adding 15 to 20 stations ahead of time. Eight of these, launched in Dubai in Q3, cater specifically to trucks, in partnership with Dubai’s Road and Transport Authority (RTA).
As of September 30, ADNOC Distribution’s UAE network included 112 fast and super-fast charging points, more than double compared to 53 at the end of 2023, with plans to reach 150-200 charging points by the end of 2024.
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Future-proofing operations
Currently, ADNOC Distribution is actively pursuing more than 20 AI-focused projects by integrating AI and advanced technologies across all business segments. ADNOC Distribution’s strategic plan is underscored by a solid financial foundation and strong cash generation. To pursue further growth, the company has earmarked between $250 and $300 million in CAPEX allocations for calendar year 2024, with 70 percent of the investment directed towards growth-focused initiatives.
Since its IPO in 2017, ADNOC Distribution has delivered significant returns to shareholders through enhanced market value and consistent dividends, including the distribution of $4.4 billion in dividends. Building on its strong financial results and operational performance over the past nine months, the Company is well-positioned for its next phase of strategic and accelerated growth.
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