(MENAFN- Hkstrategies) Abu Dhabi, UAE – February 11, 2022: ADNOC Distribution (ISIN: AEA006101017) (Symbol: ADNOCDIST), the largest fuel and convenience retailer in the UAE, which is listed on the Abu Dhabi Stock Exchange ( ADX), today announced that its EBITDA was AED 3.1 billion, with a net profit of AED 2.2 billion for the full year 2021. For the fourth quarter of 2021 , EBITDA was AED802 million, while net profit was AED571 million.
Resilient financial performance and strong balance sheet
The company delivered resilient financial performance throughout 2021, despite the volatility caused by the COVID-19 pandemic. ADNOC Distribution maintained a strong balance sheet as of December 31, 2021 and remains well positioned to continue to grow its domestic and international portfolio in line with its smart growth strategy.
As of December 31, 2021, the company’s liquidity stood at AED5.0 billion in the form of AED2.3 billion in cash and cash equivalents and AED2.8 billion in credit facilities. unused credit.
ADNOC Distribution’s commercial activity continued to implement a proactive sales strategy throughout 2021, including increased international expansion of its ADNOC Voyager lubricants into new markets. New distributors added in the third and fourth quarters in Angola and the Democratic Republic of Congo have now expanded the company’s global footprint to a total of 19 markets and contributed to an improvement in gross profit from commercial operations compared to 2020.
Business resilience and commitment to smart growth
ADNOC Distribution reported quarterly growth in total fuel volumes in 2021, with a 4% increase in the fourth quarter compared to the third. Additionally, ADNOC Distribution continued to see additional volumes from its Dubai stations, with a total of 31 stations currently operating in the emirate.
ADNOC Distribution remains committed to its smart growth strategy to provide customers and communities in the UAE with modern, digital fuel retail convenience, with the opening of 19 new stations in 2021, reaffirming its position as the leading retailer. fuel in the country with a total network of 462 service stations and 346 convenience stores throughout the country as of December 31, 2021.
The company also continues to deliver on its international growth plans with 38 stations operational in Saudi Arabia in 2021, bringing the company’s total network to 40 in the Kingdom. The company remains committed to bringing modern fuels and retail conveniences to customers and communities across the Kingdom, and continues to evaluate opportunities for international growth.
Locally, ADNOC Distribution has signed several strategic agreements. An exclusive partnership agreement with Cars Taxi provides for the supply of ADNOC Voyager fuel and lubricants, including the premium Voyager Gold 5W-40 SN range, to the company’s fleet of over 3,000 taxis in the UAE.
Improved customer experience and commitment to safety
In February 2021, the company became the first fuel retailer in the world to ensure that 100% of its frontline staff were fully vaccinated against COVID-19, as part of its commitment to keeping customers safe. and staff throughout its service station network. This was followed in October 2021 with all frontline service station staff receiving their COVID-19 booster shot.
ADNOC Distribution continued to invest in improving the customer experience throughout 2021. This was supported by the ongoing convenience store refurbishment programme, which was launched in 2019 and saw the upgrade successful than 150 stores nationwide by the end of 2021. The new-look ADNOC Oasis stores feature fresh food, barista-brewed coffee, and a wider menu selection. This contributed to an 18% increase in non-energy gross margin compared to 2020.
This also included the launch of the next-generation retail experience, the new fully self-contained, contactless, cashier-less ADNOC Oasis store. With state-of-the-art artificial intelligence technology, weight-sensing shelves, and advanced payment options, consumers can shop and pay without the need for a cashier or checkout.
The ADNOC Reward program continued to grow its network in 2021, increasing the number of ADNOC Rewards members to over 1.2 million by the end of 2021. With a total of 67 external partners, offering ADNOC Rewards members the value maximum, there were more than 100 associated offers. Average transaction values for Rewards members, compared to non-members, were 25% higher, showing the value of the program. The company also continued to provide customers with exclusive offers through Rewards, including in-store promotions and campaigns such as the successful ‘Let’s Go Shop and Win’ sweepstakes, ’50 Days of Rewards’ to celebrate the UAE Golden Jubilee and multiple activations surrounding the Abu Dhabi Grand Prix.
In December 2021, ADNOC Distribution announced the expansion of its LPG delivery service in Abu Dhabi with the addition of 30 new trucks to its existing fleet of 17, supporting door-to-door delivery of LPG cylinders to customers within one hour of ordering and using digital. offer via the ADNOC Distribution app.
Attractive shareholder proposal
Following the inclusion of ADNOC Distribution in the MSCI Emerging Markets Index in May 2021, the company was also included in the FTSE Emerging Markets (EM) Index in September 2021. Inclusion in these reputable indices helps to increase the attractiveness of ADNOC Distribution shares for potential international investors. and thereby further diversify the company’s investor base.
ADNOC Distribution remains committed to delivering profitable growth and attractive returns for shareholders. In line with its approved dividend policy, the company’s Board of Directors has proposed a cash dividend of AED1.285 billion (10.285 fils per share), equivalent to $350 million, for the second half of 2021, which will be submitted to the shareholders of the company. for approval at the Annual General Meeting scheduled for 2022. Subject to shareholder approval, the total dividend for the financial year 2021 is expected to be AED2.57 billion (20.57 fils per share).
This would translate into an annual dividend yield of 5.0% for 2021 (based on a share price of AED 4.12 as of February 11, 2022). The company paid half of the 2021 dividend in October last year and expects to pay the final payment in April 2022, subject to shareholder approval.
At its general meeting in March 2021, the company announced a change to its dividend policy for 2022, setting a minimum dividend of AED2.57 billion for 2022 (compared to a minimum of 75% of distributable profits according to the previous policy), offering a visible return on investment to shareholders until April 2023. The dividend policy for the following years remains unchanged at a dividend equal to at least 75% of distributable profits.
The dividend policy recognizes the company’s strong financial position and its confidence in its growth prospects and ability to generate cash flow in the future. ADNOC Distribution remains steadfast in delivering on its strategic commitments and sustainable returns for its shareholders.
Engineer Bader Saeed Al Lamki, Managing Director of ADNOC Distribution, said, “As we continue to work as a nation towards new growth and remain united in our vigilance in the fight against COVID-19, 2021 has been a year full of achievements for ADNOC Distribution. . We maintain a strong balance sheet and expect to continue to deliver strong financial performance in the future. This is supported by our ongoing commitment to achieving the highest levels of efficiency, which has become a primary performance indicator across all operations and is now embedded in our corporate culture. We also continue our transformation journey as a new, modern and digitally-centric retail company, delivering an enhanced customer experience across the UAE and beyond.
“The attractive value proposition we offer to our shareholders is further enhanced by our dividend policy, which I believe demonstrates the confidence we place in our ability to deliver on our growth strategy.”
Commitment to sustainable growth
The company continued to demonstrate its commitment to effectively managing environmental, social and governance (ESG) issues. In Q3 2021, ADNOC Distribution received an A grade in the MSCI ESG Ratings assessment, recognizing ADNOC Distribution’s approach to managing its business for long-term sustainability.
“We strive to achieve strong operational and financial results by adopting world-class business operations and innovation measures to ensure that our operations are managed in accordance with global best practices to deliver the greatest value to our customers. and the best returns to our investors,” added Al Lamki. .
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