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ADNOC Distribution reported today that its earnings before interest, taxes, depreciation and amortization (EBITDA) was 2.3 billion dirhams, and its net profit for the first nine months of 2021 was 1.7 billion dirhams. In the third quarter, EBITDA was 737 million dirhams and net profit was 529 million dirhams.
After relaxation of travel restrictions, successful vaccination campaigns across the UAE, government entities now returning 100% to the office, and schools returning to face-to-face teaching, the company continues to see a recovery, with total fuel consumption increasing by 10.6% in September compared to August. -Face learning. These numbers are expected to continue to increase in the fourth quarter.
The traffic volume of ADNOC Distribution’s Dubai station continues to increase. As of September 30, 2021, a total of 31 stations in the emirate are operating, and there are a total of 459 stations in the entire UAE.
The company’s commercial business continues to implement an aggressive sales strategy, including the continued international expansion of its ADNOC Voyager lubricants, the addition of new distributors in the third quarter of 2021, and the export volume so far this year has doubled from 2020.
The company’s non-fuel business continues to show improvement, with gross profit in the third quarter of 2021 increasing by 4.3% compared to the same period in 2020, thanks to the convenience store refurbishment program and attractive promotions through the ADNOC reward program Activity.
In terms of operations, as part of the ongoing transformation, the company will continue to work to reduce operating costs and ensure competitiveness in the UAE fuel retail and convenience store sectors. Despite the network growth, in the first nine months of 2021, ADNOC Distribution’s operating expenses (excluding depreciation) decreased by 17.8% compared to the first nine months of 2020.
In the first nine months of 2021, ADNOC Distribution continued to provide modern and digital fuel retail convenience to customers and communities across the UAE, opening 14 new gas stations in the UAE. In addition, its ADNOC Oasis refurbishment program has refurbished 35 stores in the UAE, offering fresh food, freshly brewed coffee by the barista and a wider menu selection.
The company obtained a no-objection certificate from the Saudi Arabian General Administration of Competition (GAC) to acquire 35 sites in Saudi Arabia. The company continues to implement its plan in Saudi Arabia. As of November 8, 2021, 10 new stations will be added, and a total of 40-45 new stations will be opened in 2021.
Commenting on the financial performance, Bader Saeed Al Lamki, CEO of ADNOC Distribution, said: “As shown by today’s performance, ADNOC Distribution presents a compelling investment story. The buds of recovery have already emerged, and accelerated growth is obvious.
“We will continue to implement our expansion plans domestically and internationally, which makes us a stronger fuel and convenience retail leader in the UAE, and strengthens our position as a global fuel retailer.”
The company has ensured that 100% of its front-line employees working at the service station have been vaccinated with boosters.
Throughout 2021, customer experience has been an integral part of the company, and the ADNOC Rewards loyalty program has recorded more than 1.2 million members.
After ADNOC Distribution was included in the MSCI Emerging Markets Index in May 2021, ADNOC Distribution was also included in the FTSE Emerging Markets (EM) Index in September 2021. The inclusion of these well-known indexes is expected to increase the attractiveness of ADNOC Distribution’s stock to potential investors in the international market, thereby further diversifying the company’s investor base.
In September, ADNOC Distribution announced that its board of directors had approved the payment of an interim dividend of AED 1.285 billion (10.285 phils per share) to shareholders for the first six months of 2021, equivalent to US$350 million, to be paid in October 2021.
This is the first payment of AED 2.57 billion (AED 20.57 per share) expected to be paid in 2021, which is consistent with the company’s dividend policy. This will translate into an annual dividend yield of 4.8% in 2021 (based on a share price of 4.26 dirhams as of November 8, 2021).
According to the policy approved by the company, the second and final dividends in 2021 are expected to be paid in April 2022, subject to the recommendation of the board of directors and shareholder approval.
The dividend policy recognizes the company’s strong financial position and confidence in its future growth prospects and ability to generate cash flow. ADNOC Distribution remains unswervingly fulfilling its strategic commitments and sustainable returns for its shareholders.
In the third quarter of 2021, ADNOC Distribution received an A rating in the MSCI ESG (Environmental, Social and Governance) rating assessment, recognizing ADNOC Distribution as a method for long-term sustainable management of its business.
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