ADNOC Distribution Plans to Expand Its Operations in 2025

With a clear growth strategy, ADNOC Distribution, the UAE’s largest fuel and convenience retailer, on Tuesday said that it plans to add 40-50 new stations across its network, including 30-40 in Saudi Arabia, and aims to install around 100 additional fast and super-fast charging points in 2025.

The company remains on track to achieve its 2028 targets, including operating 1,000 service stations and over 500 EV charging points. After installing 220 EV charging points in 2024, it also plans to double the number of Tier-1 food and beverage properties in 2025, further enhancing its retail and real estate offerings.

ADNOC Distribution disclosed these plans while announcing the financial results for 2024, achieving its highest ever Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $1.05 billion, an increase of 4.8% y-o-y, it said in a regulatory filing with Abu Dhabi Securities Exchange (ADX) this morning.

Underlying EBITDA, excluding inventory gains and one-off items, reached $989 million, an increase of 11.4% y-o-y. This record-breaking performance reflects robust fuel volumes, significant non-fuel retail growth, and increasing contributions from international operations including Saudi Arabia and Egypt.

The company has also reported a record Return On Capital Employed of 28.8% in 2024, the highest since its initial public offering on 31 December 2023. This underscores the company’s exceptional efficiency in capital allocation, ultimately resulting in greater incremental value for shareholders.

Net profit, excluding the impact of the UAE corporate income tax which came into effect in 2024, would have grown by 2.4% y-o-y to $725 million, highlighting ADNOC Distribution’s strong fundamentals. The reported net profit decreased 7% y-o-y, ADNOC Distribution said.

It has also reduced operational costs, achieving $18 million in like-for-like OPEX savings and this marked significant progress towards achieving the objective of $50 million in like-for-like OPEX reductions between 2024 and 2028.

ADNOC Distribution CEO Bader Saeed Al Lamki said that the company’s strong performance in 2024 underscored their strategic focus on delivering value for both our customers and shareholders.

By driving operational efficiency, embracing digital transformation, and expanding the company’s market presence, they were well-positioned to achieve the ambitious goals of the five-year strategy, he added.

Operational Performance

ADNOC Distribution delivered record total fuel volumes of 15 billion litres in 2024, marking a y-o-y increase of 8.7%, driven by higher mobility and expanded international operations, particularly in Saudi Arabia and Egypt.

The company’s fuel volumes in GCC countries grew by 7.6% y-o-y to 11.9 billion litres and expanded its retail network in 2024, adding 59 new service stations across the network, including 30 stations under development in Saudi Arabia.

The network growth is over three times the company’s full-year guidance of 15-20 new stations. This expansion brings its total network to 896 service stations, solidifying the company’s position as a leading fuel and convenience retailer in the region.

Non-Fuel Retail Business

The non-fuel retail business continues to demonstrate consistent strong results, with double-digit gross profit growth of 12.5% and key drivers of this growth included a 10.2% increase in non-fuel transactions, the highest convenience store conversion rate in five years, a 33% y-o-y increase in barista prepared drinks, upscaling of the car wash and lube change network, and launching additional Quick Service Restaurants.

ADNOC Distribution has added 17 new convenience stores in the UAE, taking its convenience stores network in the UAE to 373, and to 526 across its total network. This includes five standalone stores to capture opportunities for non-fuel retail growth outside its service stations in 2024.

The Company’s Board of Directors has recommended a cash dividend of $350 million, for the second half of 2024, which is expected to be paid in April 2025, subject to shareholders’ approval at the upcoming General Assembly Meeting scheduled for March 2025.