ADNOC Distribution net profit grows by 6.6% to $157mn in Q1-2019

ADNOC Distribution continues to maintain a low net debt to EBITDA ratio of 0.35x on 31 March 2019

During Q1-2019, ADNOC Distribution’s UAE network reached 379 retail fuel stations.
During Q1-2019, ADNOC Distribution’s UAE network reached 379 retail fuel stations.

ADNOC Distribution, the UAE’s largest fuel and convenience retailer and a company listed on Abu Dhabi Securities Exchange (ADX), reported that its Q1-2019 net profit increased by 6.6% to $157.39mn when compared with the same period last year.

Excluding inventory gains recorded in Q1-2018, Q1-2019 underlying EBITDA grew by 16.5% compared to Q1-2018 to $199.59mn. Q1-2019 free cash flow (EBITDA minus capital expenditures) generation grew by 24.9% year-on-year to $187.07mn. Profitability has also shown continued momentum, with Q1-2019 EBITDA margin reaching 15.4%, up from 13.6% in Q1-2018.

ADNOC Distribution recorded Q1-2019 earnings per share of $0.0125 up by 29.6% compared to Q4-2018 and by 6.6% year-on-year. Moreover, ADNOC Distribution continues to maintain a low net debt to EBITDA ratio of 0.35x on 31 March 2019.

During Q1-2019, ADNOC Distribution’s UAE network reached 379 retail fuel stations, with the addition of three new stations during Q1-2019. The company’s convenience store network reached 252, including 14 Géant Express convenience stores, as of 31 March 2019.

Q1-2019 non-fuel gross profit increased by 9.2% compared to Q1-2018. Our convenience store revitalisation programme, which offers customers an improved shopping experience, is on track and is contributing to improvements in gross margins and an uplift in average basket size by 13.2% in Q1-2019 compared to Q1-2018.

Commenting on the results, Saeed Mubarak Al Rashdi, ADNOC Distribution’s acting CEO, said: “Thanks to an unwavering focus on our customers and the resilience of our business model, we are off to a solid start in 2019. Our first quarter results confirm our ambition to sustain strong financial performance through operational excellence and premium customer service.”

“ADNOC Distribution has once again demonstrated its ability to realise profitable long-term growth, driven by greater fuel offerings and service, an enhanced convenience store experience and improved quality of service. We are well on our way to making ADNOC Distribution a world-class fuel and convenience retailer and look forward to continuing our journey in the UAE and beyond.”

We remain focused on accelerating our growth plans in 2019. In response to strong international investor interest, ADNOC Distribution will host its first-ever Capital Markets Days in London and New York in early May. We are pleased that the market recognises our ability to deliver on our IPO commitments and our potential for future growth,” Al Rashdi added.

During the company’s general assembly meeting held on 4 April 2019, ADNOC Distribution announced an enhanced dividend policy, reflecting its board of director’s confidence in the company and its commitment to reward shareholders for their trust in the company.

The new progressive dividend policy represents an increase of 63% for 2019 ($650.24mn) and 75% for 2020 ($2,571mn) compared to 2018, resulting in a 7.3% dividend yield for 2019 (based on closing share price of $0.71 on 30 April 2019 per share).

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