Adnoc Distribution’s net profit rises 22% to $749m in 2022

Adnoc Distribution

Adnoc Distribution, the UAE’s fuel and convenience retailer, reported strong earnings for 2022, with net profit rising 22 percent year-on-year to AED 2.75 billion ($748.69 million).

The company’s total fuel volumes continued to increase last year, recording an eight percent year-on-year growth in 2022, with commercial fuel volumes up by 19 percent. 

Among the key factors contributing to the growth in fuel volumes are the continued economic expansion across the Emirate, the ongoing Adnoc service station network expansion nationwide, and higher customer traffic.

Bader Saeed Al Lamki, CEO, Adnoc Distribution, said: “The company has demonstrated robust financial and operational performance throughout 2022. We have sustained our growth trajectory while generating strong cash flow and maintaining a solid financial position.

“Our priority remains to accelerate achieving sustainable growth and building incremental shareholder value through efficient capital allocation.”

Following the record earnings in 2022, Adnoc Distribution’s growth momentum is expected to continue through 2023, on the back of continued network expansion and higher non-fuel retail contribution. 

Adnoc Distribution has successfully renewed its supply agreement with majority shareholder, Adnoc, for a new five-year term in 2022.

The company added 68 new service stations across the UAE and Saudi Arabia. The company’s international service station network reached 568 sites, including 502 in UAE and 66 in Saudi Arabia, as of December 31, 2022.

Convenience store sales continued to gain momentum throughout 2022, with non-fuel retail transactions increasing by 15 percent in 2022.  

Last year Adnoc Distribution advanced its international expansion by partnering with TotalEnergies by acquiring a 50 percent stake in TotalEnergies Marketing Egypt, a fuel retail operator. The acquisition is expected to be completed in Q1 2023.

The board of directors recommended distributing a cash dividend of AED1.285 billion for the second half of 2022, which will be submitted to the shareholders for approval at the annual general meeting scheduled for 2023. 

Subject to shareholders’ approval, the total dividend for 2022 is anticipated to be AED2.57 billion, which would translate to a 4.6 percent annual dividend yield for 2022. 

The company paid half of the 2022 dividend in October last year and expects to pay the second half in April 2023. 

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