ADNOC Distribution, the UAE’s largest fuel and convenience retailer, has reported that net profit for the nine months ended September 30, 2018, increased by 28 per cent to AED 1,682 million compared with the same period last year.
EBITDA grew by 33 per cent to AED 2,157 million. Adjusted free cash-flow (EBITDA minus capital expenditures) generation was up 68 per cent year-on-year to AED 1,630 million in the first nine months of 2018.
Year-on-year, the company has also shown continued momentum, with EBITDA margin for the nine months ended September 30, 2018, reaching 13 per cent, up from 11 per cent during the same period last year.
The company’s financial performance during the first nine months of 2018 remained resilient notwithstanding a 2.3 per cent decrease in fuel volumes sold compared to the same period last year to 7,179 million litres.
The company’s convenience stores generated higher revenues driven by increased footfall and conversion rates in the third quarter compared to the second quarter of 2018. This was driven by management initiatives to improve the customer experience, including a more focused store revitalization program and the implementation of Flex Rewards, which offers Premium refueling rewards that may be redeemed in its stores convenience stores.
Commenting on the results, ADNOC Distribution Acting CEO Saeed Mubarak Al Rashdi said: “Our third quarter results confirm that we continue to deliver on our strategy, delivering and sustaining robust financial results through our focus on operational excellence, innovation, and cost efficiency. We have made significant progress across all three pillars of our strategy – fuel, non-fuel and cost-efficiency initiatives. I am pleased that our commitment to improve our customer experience by offering customers choice, convenience and better-quality products and services while also focusing on improving our financial performance has generated positive momentum and has led to the strong results we are announcing today.
“While we are continuing to strengthen our competitive positioning, we remain committed to our shareholders by pursuing our ambition to transform the company into a more performance-driven, commercially minded business and through our disciplined, return-driven capital allocation strategy.”
ADNOC Distribution's Deputy CEO, John Carey, added: “ADNOC Distribution continues to demonstrate strong and profitable performance supported by improved margins and a continued cost focus. We have seen good momentum across our businesses, led by a 54 per cent increase in EBITDA in our Retail segment and a 3 per cent increase in volumes sold by our Corporate Sales segment in the first nine months of 2018. We remain confident on the delivery of our business plan for 2018 and beyond, and are well on our way to making ADNOC Distribution a world-class fuels and convenience retailer.”