2024-02-14 18:00:24
Abu Dhabi (Etihad)
ADNOC Logistics and Services PLC today announced its financial results for the fourth quarter and fiscal year 2023.
On an annual basis, ADNOC Logistics and Services achieved net profits of AED 2,277 million (US$620 million), or AED 0.29 (US$0.08) per share. This represents an increase of 138% year-on-year compared to a net profit of AED 959 million (US$261 million) in 2022. The company’s revenues reached AED 10,118 million (US$2,755 million) in 2023, recording a 41% increase compared to In 2022.
EBITDA increased by 93% year-on-year to AED 3,217 million (US$876 million), as a result of continued strong performance across all business segments. This is due to the expansion of the EBITDA margin by 9 percentage points to 32% in 2023 compared to the same period last year, resulting mainly from growth in the integrated logistics services sector, as well as the continued strong performance in the shipping and marine services sectors. .
On a quarterly basis, net profit increased by 89% year-on-year to reach AED 606 million (US$ 165 million). The company’s revenues in the fourth quarter also increased by 26% year-on-year to reach AED 3,041 million (US$828 million), mainly driven by continued momentum in the integrated logistics services sector. EBITDA in the fourth quarter rose 43% year-on-year to reach AED 889 million (US$ 242 million).
Commenting on the company’s results, Captain Abdul Karim Al-Musabi, CEO of ADNOC Logistics and Services, said: “During 2023, which is our first year as a company listed on the stock exchange, ADNOC Logistics and Services achieved great achievements, as the share price of ADNOC Logistics and Services increased by 91%, we proportionally doubled EBITDA, and achieved a 138% increase in net profits. Our strong balance sheet and cash position will enable us to explore new growth opportunities and reinforce our commitment to providing attractive returns to shareholders. We are confident in our medium-term trends and our ability to enhance Our position as a global leader in logistics and maritime services for the energy sector.”
Financial performance
The Integrated Logistics segment recorded a revenue increase of 88% year-on-year to reach AED 6,386 million (US$ 1,739 million). This exceptional performance is due to continued growth in revenues and margins in the core business, the successful acquisition of Zakher Marine International, and new business activities such as engineering, procurement and construction. EBITDA increased by 225% year-on-year to reach AED 1,954 million (US$532 million), while its margin expanded to 31% (EBITDA margin for 2022 is 18%).
The shipping sector recorded a 3% decrease in revenues year-on-year to reach AED 3,081 million (US$ 839 million). However, strong charter rates for oil and gas tankers contributed to EBITDA increasing by 16% year-on-year to AED 1,179 million (US$321 million), expanding EBITDA margin by 6 percentage points to 38%.
On the other hand, the marine services sector recorded a growth in revenues of 6% year-on-year, reaching 650 million UAE dirhams (177 million US dollars). This resulted in EBITDA of AED 147 million (US$ 40 million), an increase of 47% year-on-year driven by higher volume of petroleum port operations.
During 2023, ADNOC Logistics and Services continued to implement its growth strategy and achieve a qualitative shift. In the fourth quarter, the company received a new giant crude oil tanker, bringing the number of tankers received in 2023 to four giant crude oil tankers. These tankers feature dual-fuel engines capable of using liquefied natural gas as a transitional fuel, with the aim of improving the efficiency and environmental performance of its fleet, especially as the company continues to support the ADNOC Group’s goal of achieving climate neutrality by 2045.
In the third quarter of 2023, the company received eight self-elevating and moving offshore support platforms, which include six owned platforms and two rented platforms. Thus, the size of this fleet increases by 25%, with the number of platforms owned and operated by ADNOC Logistics and Services increasing from 31 to 39 platforms. This step contributes to strengthening the company’s presence and position as the owner and operator of the largest fleet of self-elevating and moving marine support platforms in the world.
In the second quarter of 2023, ADNOC Logistics and Services entered the engineering, procurement and construction market and was awarded a contract worth AED 3,581 million (US$ 975 million) to carry out dredging, land reclamation and construction of offshore facilities for an artificial island in the Lower Zakum field. Obtaining this contract represented a significant step in implementing the company’s strategy to explore new growth opportunities.
Dividend distribution
ADNOC Logistics and Services Company remains committed to achieving sustainable and profitable growth and attractive returns for shareholders. In line with the approved dividend policy, the company’s Board of Directors has recommended distributing cash dividends of 477 million UAE dirhams (130 million US dollars), equivalent to 6.45 fils per share, for the second half of 2023. This recommendation will be submitted for shareholder approval. At the annual general assembly meeting. The total dividends for the second quarter and second half of 2023 are expected to reach AED 716 million (US$195 million), equivalent to 9.68 fils per share, once shareholder approval is obtained. The dividend of AED 239 million (US$ 65 million) for the second quarter of 2023 was paid in November 2023. The dividend for the second half of 2023 is expected to be paid in the second quarter of 2024, subject to shareholder approval. Under the gradual dividend policy approved by the Board of Directors, the company aims to increase annual profits by at least 5% over the medium term, based on 2023 annual profits (AED 955 million or US$ 260 million). This dividend policy will be reviewed regularly taking into account value-accumulating growth opportunities.
As part of the company’s commitment to reducing the carbon intensity of the shipping fleet, the majority of dual-fuel VLCCs have recently achieved an A carbon intensity index rating. With the mandate of the International Maritime Organization (IMO), the Carbon Intensity Index (CII) classification came into effect on January 1, 2023, with classifications assigned from A to E. Achieving the highest possible classifications reflects the commitment of the company’s newest carriers to environmental standards, and distinguishes the operational means it uses to ensure the reduction of carbon intensity. Carbon from shipping operations.
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