ADNOC Distribution has announced that all agenda items at its Annual General Assembly Meeting (AGM) have received shareholder approval. This includes the adoption of a new five-year dividend policy and the appointment of new members to the Board. The company has also reiterated its dedication to its five-year growth strategy, which will be facilitated by the implementation of artificial intelligence (AI), digitalization, and cutting-edge technology.
During our Annual General Assembly, shareholders approved a new dividend policy for 2024-2028, providing annual dividend of AED 2.57 billion or a minimum 75% of net profit, whichever is higher. (1/4) pic.twitter.com/QjR8kquJ51
— ADNOC Distribution (@ADNOCdist) March 28, 2024
$1 billion EBITDA achieved in 2023
According to Dr. Sultan Ahmed Al Jaber, UAE minister of Industry and Advanced Technology and Chairman of ADNOC Distribution, the company has delivered significant returns to its shareholders since its initial public offering in 2017. He stated that the company has achieved a 90 percent return on investment through increased market value and dividends. Furthermore, ADNOC Distribution successfully met its goal of reaching $1 billion in EBITDA for 2023, which has laid the groundwork for the company’s upcoming phase of accelerated growth. Dr. Al Jaber emphasized that the company remains focused on pursuing valuable expansion opportunities both domestically and internationally, including venturing into new markets.
The chairman highlighted how ADNOC Distribution has been an early adopter of AI to enhance operational efficiency and enhance the customer experience. He assured that the company will continue to leverage AI and other rapidly evolving technologies to create additional value for its business, shareholders, and customers.
Dr. Al Jaber expressed confidence in the company’s new strategy and its potential for future growth. As a result, ADNOC Distribution has introduced a more rewarding five-year dividend policy that offers long-term visibility for returns and the potential for increased dividends based on future earnings growth. This new policy further aligns with the company’s sustainable growth trajectory, predictable cash flow, and commitment to delivering attractive returns to its shareholders, he noted.
New dividend policy (2024-2028)
The Company has implemented a new dividend policy for the period of 2024-2028. Under this policy, an annual dividend of $700 million or a minimum of 75 percent of net profits, whichever is higher, will be set. During the Annual General Meeting (AGM), shareholders approved the distribution of AED1.285 billion in dividends for the second half of 2023. This amount is equivalent to 10.285 fils per share and is expected to be paid in April 2024. With this distribution, the total dividend for 2023 reaches AED2.57 billion, resulting in a yield of 5.6 percent based on the share price of AED3.66 on March 27, 2024.
The Company unveiled its new strategy during an Investor Day held in February 2024. This strategy highlights the Company’s commitment to domestic growth, international platforms, and ensuring the future competitiveness of the business. ADNOC Distribution aims to become a leader in the evolving energy landscape.
Expansion plans in Saudi Arabia and Egypt
As part of its accelerated growth strategy, the Company intends to increase its presence in international operations, particularly in Saudi Arabia and Egypt. It also plans to explore opportunities for growth that will contribute positively to its overall performance. The Company’s robust balance sheet and strong cash flow generation will support these initiatives. Additionally, the Company aims to expand into new sectors such as lubricants and LPG, develop sustainable transport solutions, and explore opportunities for expansion in new global markets.
Expanding network to 1,000 service stations by 2028
Eng. Bader Saeed Al Lamki, CEO of ADNOC Distribution, highlighted the strength of the company and its future objectives. He emphasized the transparent and highly rewarding five-year dividend policy, which demonstrates the company’s robust cash generation and ambitious growth strategy. The expansion of the network to 1,000 service stations by 2028, along with a 50 percent growth in non-fuel transactions and a 25 percent increase in convenience stores, is part of the strategic plan. Furthermore, the company aims to strategically develop its electric vehicle infrastructure, aiming for more than 500 fast and superfast chargers by 2028, representing a tenfold increase from 2023. By prioritizing sustainability and leveraging technology and innovation, ADNOC Distribution is positioning itself as a global leader in multi-energy mobility and convenience.
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