Adnoc Distribution posts Dh2.22b net profit for 2019
Adnoc Distribution reported on Wednesday an 11.3 per cent jump in fourth-quarter net profit to Dh496 million, driven by "a solid operational performance" in both fuel and non-fuel businesses.
For the full year 2019, the net profit of the UAE's largest fuel and convenience retailer soared to Dh2.22 billion, up 4.2 per cent compared to 2018, the company said.
The company's board had recommended a dividend of Dh 1.194 billion (9.55 fils per share) for the second half of 2019, taking full-year 2019 dividend to Dh2.39 billion (19.10 fils per share), a 62 per cent increase over the previous year. The company paid half of the 2019 dividend in October of last year and expects to pay the final payment in April 2020, subject to shareholders' approval.
Earnings before interest, taxes, depreciation and amortization (Ebitda) for the fourth quarter of was Dh658 million, an increase of 6.5 per cent compared to the same period last year. "Total fuel volumes sold increased by 2.0 per cent in the fourth quarter of 2019 compared to the fourth quarter of 2018, driven by a continued recovery in the company's retail business, growth in its corporate business and supported by new marketing initiatives. Growth in retail fuel volumes was driven by improvement in the core Abu Dhabi market, market share gains in the Northern Emirates following the implementation of free assisted fuelling and the contribution from new stations in Dubai," the company's statement said.
Non-fuel retail gross profit increased by 10.4 per cent for the same period compared to the fourth quarter of 2018. "This was supported by the company's convenience store revitalisation program which offers customers improved shopping experience, contributing to an uplift in average basket size by 5.4 per cent in 2019 fourth quarter compared to the same 2018 period.
Adnoc Distribution's acting CEO, Ahmed Al Shamsi, said the company had delivered strong results in the fourth quarter as well as for the full year 2019. "We continue to transform Adnoc Distribution into a world-class, customer-focussed, commercially driven company with a determined focus on driving profitable growth. As we sharpen our focus on customer experience and pursue growth opportunities, both domestically and internationally, we will expand all our distribution channels to reach larger market segments and sustain volume growth. Finally, Opex reduction and optimisation of Capex also remain key priorities," said Al Shamsi.
For the full year 2019, Ebitda increased 2.3 per cent to Dh2.84 billion, while underlying Ebitda (excluding inventory gains) grew 7.2 per cent to Dh2.72 billion, compared to 2018. The company's Ebitda margin has also shown continued momentum, reaching 13.3 per cent in 2019, up from 12.1 per cent in 2018.
"Adnoc Distribution continues to focus on realizing cost efficiencies, which has contributed to 8.6 per cent reduction in operating expenses for 2019 compared to 2018," said the statement.