ADNOC Distribution board approves $350 million interim cash dividend for H1 2024

ADNOC Distribution, the UAE’s largest fuel and convenience retailer, which is listed on the Abu Dhabi Securities Exchange (ADX), today announced that the Board of Directors has approved an interim dividend of US$350 million (AED1.285 billion) for the first half of 2024, equivalent to 10.285 fils per share, underscoring the Company’s commitment to delivering consistent and attractive returns to its shareholders. The deadline for purchasing shares to qualify for the interim dividend payment is September 26, 2024, with eligibility based on shareholders recorded in the share register on September 30, 2024.

The H1 dividend marks the first installment of the expected full-year 2024 dividend of $700 million (AED2.57 billion), equivalent to 20.57 fils per share. This aligns with ADNOC Distribution’s five-year dividend policy, which sets an annual dividend of $700 million or a minimum of 75% of net profits, whichever is higher, from 2024 to 2028, subject to Board discretion and shareholder approval.

The second and final dividend for 2024 is expected to be paid in April 2025, subject to the Board’s recommendation and shareholder approval. The full-year 2024 dividend would offer a 5.6% annual dividend yield, based on the share price of AED3.67 as of September 20, 2024.

The dividend policy provides long-term visibility on expected shareholder returns and potential upside from future earnings growth, reinforcing ADNOC Distribution’s commitment to consistent shareholder value creation.

Eng. Bader Saeed Al Lamki, CEO of ADNOC Distribution, said: “ADNOC Distribution has demonstrated exceptional performance in H1 2024, driven by strong financial results and confidence in future growth. The successful execution of our smart growth strategy reinforces the Company’s attractive value proposition, while our healthy balance sheet and robust cash generation underpin future growth and shareholder returns.”

In the first half of 2024, ADNOC Distribution reported a 16% year-on-year (YoY) increase in Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) to $515 million (AED1.89 billion) and a 7.7% YoY rise in net profit to $319 million (AED1.17 billion), driven by higher fuel volumes, increased contributions from international operations, and growth in the non-fuel retail business.

The Company generated free cash flow of $488 million (AED1.79 billion) in H1 2024, comfortably covering the interim dividend of $350 million (AED1.285 billion). As of June 30, 2024, it continued to maintain a strong financial position with a net debt-to-EBITDA ratio of 0.53x and liquidity of $1.7 billion (AED6.2 billion), including a cash position of $925 million (AED3.4 billion), positioning it favorably for future growth and shareholder value creation.

Since its IPO in 2017, ADNOC Distribution has delivered solid returns to shareholders through enhanced market value and consistent dividends. It will have paid a total of $4.4 billion (AED16.2 billion) in dividends since IPO, including the H1 2024 dividend. With a record EBITDA of $1 billion (AED 3.68 billion) in 2023, the Company is on track to deliver on its growth commitments and is well-positioned for its next phase of strategic and accelerated growth.

In addition to the dividend policy, ADNOC Distribution unveiled a new five-year growth strategy earlier this year, focused on domestic growth, international platforms, future-proofing the business, enhancing digital capabilities, and driving operational efficiencies. This strategy aims to position the Company for long-term growth while continuing to deliver shareholder value.

“Our new strategy enables us to capture new market positions both at home and abroad, reinforcing our leadership and creating long-term value to sustain shareholder returns,” added Eng. Bader Saeed Al Lamki.

ADNOC Distribution remains committed to exploring growth opportunities in fuel and non-fuel retail, as well as new revenue streams emerging from the energy transition. The Company is keen to expand its new mobility solutions, including Electric Vehicle (EV) charging, while maintaining a strong focus on sustainability-driven initiatives. As part of its initiatives to future-proof its business, the Company focuses on growth and sustainability, stemming from its primary goal of delivering long-term sustainable value to shareholders.

ADNOC Distribution’s strategic investment plan is underpinned by a solid financial foundation and strong cash generation.