Country's biggest fuel distributor says earnings boosted by higher oil prices
Adnoc Distribution reports higher profit for 2017
Adnoc Distribution, the UAE's biggest fuel distributor and convenience store operator, said its 2017 preliminary profit rose 1.3 per cent, boosted by higher oil prices and an increase in volumes.
The results were the company’s first financial results since it sold shares to the public in December and announced an expansion into Saudi Arabia and Dubai.
Net profit rose to Dh1.8 billion in 2017, or Dh0.144 per share, compared with Dh1.78bn, or Dh0.142 per share in 2016, the company said in statement on its website. Revenue rose 11.8 per cent to Dh19.76bn in 2017 versus Dh17.67bn in 2016, it said. Total assets rose to Dh12.2 b in 2017 from Dh11.44bn in 2016.
Adnoc Distribution said its gross profit margin last year increased 4.7 per cent to Dh4.43bn from Dh4.23bn in 2016 due to higher average fuel margins. Earnings before interest, tax and depreciation and amortisation gained 7.3 per cent to Dh2.28bn in 2017 versus Dh2.13bn in 2016 due to higher margins, cost effectiveness and efficiency improvements across the business.
The company’s audited results will be released later in the month, a spokesman for the company said.
Adnoc said last month that it will open its first service stations in Dubai and Saudi Arabia this year, an expansion boosted by the removal of subsidies on fuel.
The company, which listed on the Abu Dhabi stock exchange in December, will roll out at least 13 new service stations this year, and extend three of its existing facilities.
Expansion into Dubai, the only emirate where the company has no physical presence, is now feasible for the company following changes to how fuel is priced were introduced across the UAE in August 2015, Saeed Al Rashidi, Adnoc's acting chief executive officer, told The National last month.
Adnoc Distribution currently operates 360 service stations and 235 Oasis convenience stores across the UAE, with the exception of Dubai, holding a monopoly in Sharjah and Abu Dhabi. Enoc and Emarat are the only operators in Dubai.
Through a franchise model, Adnoc Distribution will open a service station in Saudi Arabia this year.
The franchise venture will be the first of its kind for the company, which had previously explored such a model with Saudi Arabia's Al Olaibi Group for service stations in Riyadh, Makkah and Madinah.
Adnoc Distribution sold 10 per cent of the company in December in an initial public offering on the Abu Dhabi stock exchange. The listing, which valued the company at Dh31.1bn, was the first to be held on the bourse in over six years.