Adnoc Distribution's full-year net profit surges 22% on higher revenue

The company's revenue jumped 54 per cent to Dh32.11bn

Adnoc Distribution's revenue jumped 54 per cent to more than Dh32 billion in 2022. Photo: Adnoc Distribution
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Adnoc Distribution, the UAE’s largest fuel and convenience retailer, said its 2022 net profit surged 22 per cent as revenue rose on the back of strong growth in fuel sales.

Net profit for the year to the end of December rose to about Dh2.75 billion ($750 million) from 2021, the company said in a statement to the Abu Dhabi Securities Exchange, where its shares are traded.

Revenue for the reporting period jumped about 54 per cent to more than Dh32 billion, driven by higher fuel selling prices amid a rise in global crude prices.

“The company has demonstrated robust financial and operational performance throughout 2022,” said Bader Al Lamki, chief executive of Adnoc Distribution.

“We have sustained our growth trajectory while generating strong cash flow and maintaining a solid financial position.”

Total fuel volumes in 2022 increased 8 per cent on “continued economic expansion” in the UAE, continuing service station network expansion and higher customer traffic, the company said.

Adnoc Distribution’s commercial fuel volumes rose by 19 per cent in the same period.

The company’s non-fuel business continued to show strong growth, reporting a 15 per cent increase in non-fuel transactions, as initiatives aimed at boosting customer experience bore fruit.

Adnoc Distribution opened 21 new stations in the UAE in the fourth quarter, taking its local network to more than 500 sites.

Last year, the company acquired a 50 per cent stake in TotalEnergies Marketing Egypt, one of the top four fuel retail operators in Egypt. The deal is expected to be completed in the first quarter of 2023 pending regulatory approvals.

“The year was marked by several milestones in Adnoc Distribution’s history, including the signing of our largest-ever international acquisition in Egypt,” said Mr Al Lamki.

“Furthermore, we showcased our ability to provide a cutting-edge digitally-enabled customer experience, while also achieving long-term sustainable growth to generate attractive shareholder returns.”

Adnoc Distribution’s 2022 dividend policy was set at a minimum of Dh2.57 billion, offering an annual dividend yield of 4.6 per cent (based on a share price of Dh4.44 as of closing on February 8, 2023).

The company paid a dividend of Dh1.285 billion for the first six months of 2022 in October, and expects to pay the second six-month dividend of 2022 (10.285 fils per share) in April 2023, subject to the discretion of the board and shareholders’ approval.

The company’s dividend policy for the years thereafter sets a dividend equal to at least 75 per cent of distributable profits.

Since its IPO in 2017, Adnoc Distribution has maintained a consistent dividend track record. It expects earnings momentum in fuel and non-fuel businesses to improve in 2022 and beyond, and support its dividend policy.

The company, which plans to reduce its carbon intensity by 25 per cent by 2030, said last month that it would install solar panels to power service stations, use biofuels in its fleet of vehicles and expand its network of electric vehicle charging stations, in addition to using eco-friendly “green concrete”, in the construction of service stations.

Updated: February 09, 2023, 9:19 AM