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ADNOC Distribution announced recording strong profits during the year 2022, as it achieved profits before interest, tax, depreciation and amortization of 3.52 billion dirhams, an increase of 15% on an annual basis, while net profit increased by 22%, to reach 2.75 billion dirhams in 2022, while the company witnessed a continuous increase in The total quantities of fuel sold increased by 8%, with an increase of 19% in the quantities of commercial fuels. This growth is mainly attributed to the continuous economic expansion in the UAE, the continued expansion of the company’s station network locally, and the increase in shopping traffic at service stations.
Engineer Badr Saeed Al-Lamki, CEO of ADNOC Distribution, said: “Following the record results achieved by ADNOC Distribution in 2022, it is expected that the company’s growth momentum will continue during 2023, which is the year in which the company aims to achieve profits before interest, tax, depreciation and amortization. Less than $1 billion, due to the continuous expansion of its network of stations and the high contribution of the non-fuel retail sales sector.
He added: «As part of its endeavor to strengthen its business in the future, the company continues to explore opportunities for increased growth and new sources of revenue through transformation in the energy sector, including new mobility solutions such as electric vehicle charging, and in 2023 ADNOC Distribution succeeded in renewing its agreement with ADNOC to supply refined products for another 5 years, thus enhancing the strength of its financial position supported by its predictable profit margins and the ability of its core business to generate strong cash flows. This also shows the strong and continuous support that the company enjoys from ADNOC, its main shareholder.
68 new service stations
He said, “The company strengthened its growth path in 2022 through its commitment to providing the latest digitally enhanced fueling and shopping services to its customers and the local communities it serves across the country. In addition, the year 2022 witnessed the opening of 68 new service stations in the UAE and the Kingdom of Saudi Arabia, of which 21 stations were opened during the last quarter of the year, including a distinguished station that was built according to the latest international standards located on Sheikh Zayed Road in the center of the Emirate of Dubai. . The total number of the company’s stations internationally reached 568 service stations, including 502 service stations in the UAE and 66 service stations in the Kingdom of Saudi Arabia, as of December 31, 2022.
Retail store sales
According to Al-Lamki, “Retail store sales continued to achieve more momentum during 2022, as the number of non-fuel transactions increased by 15% year-on-year during 2022. This was contributed by the company’s commitment to the non-fuel retail sector strategy, with a focus on enhancing Customer shopping experience and modernization of ADNOC Oasis stores through the renovation of 42 stores. Promotional initiatives related to the ADNOC Rewards program also contributed to the growth, as it now covers all shopping activities at service stations – including refueling, oil changes, purchases in stores and car washes. The company maintained its leading position as the largest operator of retail stores nationwide by expanding its network of stores, which increased from 346 stores at the end of 2021 to 362 stores at the end of 2022.
15% increase in the number of non-fuel transactions
ADNOC Distribution’s quest for long-term shareholder returns is underpinned by its commitment to making its business more competitive in the future, including through initiatives such as the recently announced partnership with TAQA to establish E2GO. The company intends to continue the momentum in terms of sustainability efforts during 2023 and beyond to ensure the future of its operations, including the installation of solar panels to operate service stations, and the use of biofuels to operate its fleet of vehicles.
In terms of sustainability, the company has also pledged to reduce emissions from its operations and reduce carbon intensity by 25% by 2030, and has also announced the conversion of an existing loan of $1.5 billion (5.5 billion dirhams) into a sustainability-related loan, underlining the company’s commitment. achieving sustainability in its daily operations.
Rewarding returns for shareholders
ADNOC Distribution confirmed that it is committed to achieving profitable growth and rewarding returns for shareholders. Within the framework of the established dividend policy, the company’s board of directors recommended the distribution of cash dividends of 1.285 billion dirhams (10.285 fils per share) for the second half of 2022, and they will be presented to shareholders for approval during the annual meeting of the general assembly to be held in 2023.
The total dividend distribution for the fiscal year 2022 is expected to amount to 2.57 billion dirhams (20.57 fils per share). This means an annual earnings per share of 4.6% for the year 2022 based on the share price of 4.44 dirhams as on February 8, 2023. The company had distributed half of the 2022 dividend in October last year, and the second part of the dividend is expected to be paid in April 2023. The company’s dividend policy for the following years stipulates the distribution of dividends of at least 75% of the distributable profits.
