Abu Dhabi, UAEMonday 23 November 2020

Taqa’s Q3 profit slides as expenses rise

The company's board increased its foreign ownership limit to 49%

The Taqa Harding oil production platform in the North Sea. The company reported a 53 per cent drop in third-quarter profit as operating expenses rose. Courtesy Taqa
The Taqa Harding oil production platform in the North Sea. The company reported a 53 per cent drop in third-quarter profit as operating expenses rose. Courtesy Taqa

Abu Dhabi National Energy Company, also known as Taqa, said third-quarter profit more than halved as operating expenses rose.

Net profit attributable to equity holders of the parent for the three months to the end of September declined to Dh700 million ($190.5m) from Dh1.5 billion in the year-earlier period, the company said in a statement on Tuesday to the Abu Dhabi Securities Exchange, where its shares trade. Operating expenses rose to Dh6.63bn from Dh172m in the same period last year, while revenue jumped more than fourfold to Dh10.8bn.

“Strong market headwinds have challenged the entire energy industry this year, but as a new, transformed company, Taqa’s financial results demonstrate the company’s ability to deliver on our core mandate – to reliably supply energy and water to those we serve,” Jasim Husain Thabet, Taqa’s group chief executive and managing director, said. “Taqa continues to forge ahead, emboldened by the operational and strategic ambitions we established at the closing of our landmark transaction with ADPower (Abu Dhabi Power Corporation).”

The company’s net income reduced to Dh1.3bn in the first nine months of this year, owing to a lower contribution from the oil and gas segment and due to a Dh1.5bn post-tax impairment charge taken in the first quarter this year. Group revenues were 7 per cent lower at Dh30.8bn due to lower commodity prices.

Earlier this year, Taqa completed its transaction with ADPower to create one of the largest utility companies in Europe, the Middle East and Africa region with total assets worth about Dh200bn.

“Looking ahead, I am confident that Taqa’s expanded scale, financial strength and capital structure will enable us to deliver on our core mandate and secure domestic and international growth opportunities that deliver sustainable returns to shareholders and position the company for success – now and for many years to come.”

Taqa’s board of directors also approved an increase in the company’s foreign ownership limit to 49 per cent, effective immediately. Ownership was previously limited to UAE nationals and institutions.

The board proposed a new dividend policy that will target a total dividend of 2.50 fils per share for 2020, growing 10 per cent annually for the following two years. As per the proposed policy, dividends for 2020 will be paid through an interim dividend of 1.50 fils per share to be paid as soon as possible and a final dividend of 1 fils per share to be paid after the annual general assembly in 2021.

Dividends for 2021 and 2022 will be paid quarterly. Taqa said it will be the first UAE-listed company to pay dividends on a quarterly basis.

Updated: November 11, 2020 08:10 PM

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