ADNOC Distribution reinforces commitment to growth in 2023

UAE’s ADNOC Distribution announced strong 2022 results with robust and continued growth and 2023 will see the company to continue to focus on growth and sustainability as well.

ADNOC Distribution said in a statement that its shareholders have approved all agenda items, including an amendment to its 2023 dividend policy at its Annual General Assembly Meeting. The company’s strong growth in 2002 enabled the company to offer an attractive dividend policy with a minimum AED 2.57 billion dividend (20.57 fils per share) for 2023 (compared to a minimum 75% of distributable profits as per previous policy). The dividend policy for the years thereafter remains unchanged at a dividend equal to at least 75 percent of distributable profits.

The approved dividend policy amendment recognises the Company’s strong financial position at the end of 2022 and confidence in its growth prospects and cash-flow generation ability going forward. ADNOC Distribution remains confident and steadfast in the delivery of its strategic commitments and sustainable returns for its shareholders.

In 2022, ADNOC Distribution increased its network in the UAE to 502 stations while adding an additional 28 ADNOC Oasis convenience stores to bring the total to 362 and refurbishing an additional 42. International expansion was the prominent focus throughout the year as the Company grew its network in Saudi Arabia to 66 and further advanced its international expansion with the acquisition of a 50 percent stake in TotalEnergies Marketing Egypt.

Within the framework of this expansion, the Company will rebrand 10 flagship service stations – the first of which will open in Q3 2023 with a signature ADNOC Oasis convenience store. ADNOC Distribution will follow-up with a further nine service station rebrands in 2024.

Moreover, ADNOC Distribution will launch its lubricants in Egypt as it continues to expand all segments of the Company’s business internationally.

H.E. Dr. Sultan Ahmed Al Jaber, Chairman of ADNOC Distribution, said: “The journey of ADNOC Distribution in 2022 was one powered by growth and the realisation of the Company’s vision to venture beyond our borders into new markets. It is one that has also resulted in a heightened awareness of how closely intertwined our interests are with those of the future as we continue to build a more resilient business model which focuses increasingly on sustainability.”

“As much as 2022 was about growth, our journey in 2023 will focus on growth and sustainability. As we enter the UAE year of sustainability, never has it been so essential for us to further commit to proving that our business can both support the strategic goals of our nation, while at the same time create long-term sustainable value for our shareholders.”

Important steps have been taken to future-proof ADNOC Distribution’s business, with a recent partnership agreed with TAQA to establish E₂GO, a joint venture to build and operate electric vehicle infrastructure in the UAE. The Company also continues electric vehicle (EV) chargers roll-out in Q1 increasing to 36 charging points across the UAE, which will eventually sit under the E₂GO umbrella.

ADNOC Distribution has also announced plans to decarbonise operations and reduce carbon intensity by 25 percent by 2030, in addition to having converted its existing US$1.5 billion term loan into a sustainability-linked loan.

The Company recorded record financial results in 2022, with earnings before interest, tax, depreciation and amortization (EBITDA) of AED 3.52 billion – a year-on-year rise of 15 percent, and a Net Profit of 2.75 billion, up 22 percent year-on-year. The Company also maintained a strong balance sheet, with liquidity of AED 5.5 billion in the form of AED 2.7 billion in cash and cash equivalent, and AED 2.8 billion in unutilised credit facilities, and net debt to EBITDA of 0.78x.

Eng. Bader Saeed Al Lamki, CEO, ADNOC Distribution, said: “Our strong cash flow and solid financial position added new strength to ADNOC Distribution’s 50-year foundation, ensuring that we are well positioned to deliver on our growth ambitions over the coming years, both domestically and internationally.”

“In 2022, we achieved several important milestones, especially with regard to our service station expansion, international growth, and cutting-edge technologies. The Egypt acquisition marks our largest-ever international investment, and one that takes us into the MENA region’s most populous market. Meanwhile, our network crossed the 500 station mark – including station 222, our flagship site on Dubai’s Sheikh Zayed Road featuring advanced customer experience and sustainability technology.

“I am confident that our ongoing emphasis on diverse national and international expansion, coupled with an unyielding dedication to providing top-notch, inventive, and environmentally sound mobility products and solutions, will enable us to achieve and surpass our growth targets for numerous years to come.”