ADNOC Logistics and Services plc (ADNOC L&S) has announced its financial results for the third quarter and the first nine months (9M) of 2024. For the nine-month period ending in September 2024, the company reported revenues of $2,668 million (AED9,798 million), representing a 38 percent increase compared to the same period in 2023. EBITDA also rose significantly by 37 percent, reaching $867 million (AED3,184 million), with EBITDA margins maintained at 32 percent across all business segments. The net profit for the first nine months of 2024 stood at $576 million (AED2,117 million), translating to $0.08 (AED0.29) per share, marking a 27 percent rise from 9M 2023.
In the third quarter, ADNOC L&S experienced a 32 percent year-on-year (y-o-y) increase in revenue, totaling $928 million (AED3,410 million). EBITDA for Q3 rose by 26 percent y-o-y, amounting to $275 million (AED1,011 million). The net profit for Q3 increased by 18 percent y-o-y, reaching $175 million (AED643 million). This impressive financial performance reflects the successful implementation of ADNOC L&S’s growth strategy, which emphasizes value-driven investments in energy-related maritime logistics.
Strategic growth and long-term demand
Eighteen months after its landmark IPO, ADNOC L&S has made significant strides toward achieving its strategic investment objectives, supported by over 340 years of long-term contracted demand.
Focus on enhancing shareholder value through growth
Captain Abdulkareem Al Masabi, CEO of ADNOC L&S, noted that the strong financial results affirm the company’s commitment to its strategic goals and its focus on enhancing shareholder value through growth. He mentioned that the anticipated contributions from Navig8 would further elevate ADNOC L&S’s status as a leading global energy maritime logistics firm and that the solid balance sheet positions the company for additional organic and inorganic growth opportunities.
Integrated logistics segment performance
Revenues from the Integrated Logistics segment surged to $1,671 million (AED6,137 million), a 51 percent increase from 9M 2023. This growth is attributed to enhanced utilization of Jack-Up Barges (JUBs), an expanded fleet, increased logistics volumes, fast-tracked project deliveries related to Hail & Ghasha, and progress in Engineering, Procurement and Construction (EPC) projects, notably the G-Island project, which is expected to be 70-75 percent complete by year-end. The Integrated Logistics EBITDA rose by 38 percent to $505 million (AED1,856 million) during the first nine months of 2024 compared to the previous year.
Shipping segment contributions
The Shipping segment also saw revenue growth of 23 percent, reaching $745 million (AED2,737 million) compared to 9M 2023. This increase was driven by robust charter rates for Tankers and Dry Bulk, along with additional revenue generated from the four new Very Large Crude Carriers (VLCCs) acquired in 2023. However, profits from Gas Carriers were slightly impacted due to the cessation of spot charter-in operations and technical off-hire days during Q1 2024. Shipping EBITDA increased by 32 percent to $316 million (AED1,159 million), contributing to a three-percentage point rise in EBITDA margin to 42 percent.
Services segment growth
In the Services segment, revenues grew by 20 percent to $252 million (AED924 million) compared to 9M 2023, with an EBITDA of $46 million (AED168 million), reflecting a 48 percent increase, primarily driven by heightened volumes in petroleum port and onshore terminal operations.
Future growth and acquisitions
ADNOC L&S remains committed to its growth strategy, with the acquisition of Navig8, announced in the first half of 2024, set to accelerate this trajectory. The deal is anticipated to be immediately value-accretive, with projections indicating a boost to ADNOC L&S’s earnings per share of at least 20 percent in the first full year post-acquisition. Regulatory approvals for the transaction are currently underway, with completion expected no later than March 31, 2025.
Strengthening asset base
Throughout the year, the company has also enhanced its asset base by securing new build contracts for energy-efficient vessels. Contracts amounting to up to $2.5 billion (AED9.2 billion) have been awarded for as many as 10 new Liquefied Natural Gas (LNG) Carriers, alongside $1.4 billion (AED5 billion) through AW Shipping for nine Very Large Ethane Carriers (VLECs) and approximately $500 million (AED1,836 million) for four Very Large Ammonia Carriers (VLACs).
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