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March 3, 2024

ADNOC Distribution board approves $350m interim dividend

ADNOC Distribution’s board of directors has approved an interim dividend of $350m (Dhs1.3bn) for the first six months of 2023, equivalent to 10.3 fils per share.

The interim dividend represents the first part of the expected full-year 2023 dividend payment of a minimum of $700m (Dhs2.57bn), which is equivalent to 20.57 fils per share, in line with the company’s dividend policy.

The fuel distribution company said the second and final dividend for 2023 is expected to be paid in April 2024, subject to the board’s recommendation and shareholder approval.

“The 2023 full-year dividend would offer a 5.4 per cent annual dividend yield (based on the share price of Dhs3.80 as of 25 September 2023),” ADNOC Distribution said in a statement.

The company’s H1 2023 revenues rose by 4.9 per cent year-on-year (YoY) to Dhs16.1bn, driven by growth in fuel volumes and non-fuel business and the consolidation of TotalEnergies Marketing Egypt. This is despite lower selling prices as a result of lower crude oil prices.

ADNOC Distribution’s half-year gross profits plunged 16.2 per cent YoY to Dhs2.7bn.

Due to lower oil prices during the period under review, the company recorded inventory gains of Dhs80m in the fuel retail business but incurred Dhs20m inventory losses in the commercial business.

“ADNOC Distribution continues to offer an attractive value proposition to its shareholders, underpinned by our commitment to delivering on our smart growth strategy, future-proofing the business, and unlocking additional value from efficiency enhancements,” said Bader Saeed Al Lamki, CEO of ADNOC Distribution.

The company’s dividend policy for 2024 and beyond sets a dividend payout of a minimum of 75 per cent of distributable profits.

Since its IPO in 2017, the company has paid a total of $3.7bn (Dhs13.6bn) in dividends, including the H1 2023 dividend.

ADNOC Distribution strengthens its presence in Egypt

Meanwhile, the company inaugurated three ADNOC-branded service stations in Egypt, across Greater Cairo, to offer a full range of vehicle services to the local communities.

The opening of the service stations in Egypt aligns with the company’s vision to become a leading regional provider of mobility solutions while reaffirming its commitment to a smart growth strategy, with more than 800 sites across the UAE, Egypt and Saudi Arabia.

ADNOC Distribution plans to open a further six ADNOC service stations in Egypt by the end of 2023, following the acquisition of a 50 per cent stake in TotalEnergies Marketing Egypt earlier this year.

The venture includes a diversified downstream portfolio of 240 fuel retail stations, more than 100 convenience stores, over 250 lube changing stations, car washes, lubricants, wholesale, and aviation fuel operations. It secured the rights to supply aviation fuel to Etihad Airways for flights fueled in Cairo.

The Abu Dhabi-based firm launched its signature ADNOC Oasis convenience stores, as part of this initial roll-out, offering a wide range of food and beverages tailored to Egyptian customers, including the brand’s speciality grade, 100 per cent Arabica coffee.