Adnoc L&S first quarter revenue increases 41%, Ebitda up 20%
Earnings before interest, taxes, depreciation and amortisation (Ebitda) rose by 20 per cent to $344 million (Dh1.262 billion) in the same period, driven by robust performance across all business segments, sustaining the Ebitda margin at 29 per cent.
Net profit for Q1 2025 was $185 million (Dh678 million), down five per cent compared to Q1 2024, mainly due to lower commercial shipping rates, but up three per cent compared to the previous quarter. 'Despite evolving market conditions, Adnoc L&S' strategic diversification and resilient business model supports delivery of strong net profit and operating cash flow,' the company said in a statement.
Captain Abdulkareem Al Masabi, CEO of Adnoc L&S, said: 'Adnoc L&S continues to deliver robust financial results and significant business growth. Our recent acquisition of 80 per cent of Navig8, and the integration of their capabilities into our expansive services portfolio, further strengthens our customer offerings and international footprint, unlocking new shareholder value. Moving forward, we will continue to deliver on our transformational growth strategy while leveraging cutting-edge technologies and AI solutions to further enhance operational efficiencies.'
Revenues from the integrated logistics segment increased to $628 million (Dh2.307 billion), up 23 per cent compared to Q1 2024. The increase was largely driven by higher revenues from engineering, procurement and construction (EPC) projects including the Al Omairah Island and Hail & Ghasha projects, and improved utilisation and rates earned from Jack-Up Barges (JUBs). Integrated logistics' Ebitda rose by 15 per cent to $182 million (Dh669 million) compared to Q1 2024.
Revenues from the shipping segment increased 87 per cent to $469 million (Dh1,722 million), compared to Q1 2024, driven primarily by the consolidation of revenue from the Navig8 tanker fleet. Shipping Ebitda increased 26 per cent to $143 million (Dh527 million) compared to the same period last year, generating a robust Ebitda margin of 31 per cent.
Revenues from the services segment increased 9 per cent to $84 million (Dh310 million) compared to Q1 2024. Ebitda from the segment grew 52 per cent year-on-year to $18 million (Dh66 million), mainly driven by higher Borouge Container Terminal volumes and shares of profit from Integr8.
Adnoc L&S continues to secure its future earnings. The Company has added 340 years of newly contracted revenues against its recent order of energy-efficient vessels, including $2.95 billion (Dh10.8billion) invested into eight new Liquified Natural Gas Carriers, nine Very Large Ethane Carriers, and four Very Large Ammonia Carriers.
The company maintained its Ebitda and net income guidance for 2025, with continued strength and growth in integrated logistics business returns helping to offset weaker than anticipated shipping results in Q1 due to weaker shipping market rates, with an improving outlook for rates.
Adnoc L&S anticipates an additional $3 billion+ of value-accretive organic investment spend by 2029, beyond the projects already announced and incorporated in guidance, applying the same investment return criteria.
The company's dividend policy remains unchanged with a projected total dividend payable for 2025 of $287 million (a 5 per cent increase from 2024 annualised dividend), in line with the stated progressive dividend policy and subject to relevant approvals.
The company targets a 2.0-2.5x net debt / Ebitda ratio over the medium term, with the recently committed hybrid capital instrument, debt, and free cash flows after dividends, the primary funding sources for committed and anticipated growth investment.
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