Two ADX-Listed Firms Report Profits in First Half of 2024

Two UAE companies – Modon Holdings and Borouge – both listed on Abu Dhabi Securities Exchange (ADX), on Wednesday reported financial performance for the first half of 2024.

In a disclosure to ADX this morning, Modon Holdings (formerly Q Holding) said that it has acquired Modon Properties and Abu Dhabi National Exhibition Centre (ADNEC) and reported a revenue of $600 million, a y-o-y increase of 333%, and a gross profit of $226.84 million, a y-o-y increase of 277%.

The company achieved a net profit of $2.38 billion including the provisional bargain purchase gain from the acquisition of Modon Properties and ADNEC.

This landmark transaction marked one of the largest acquisitions in the country’s history and sets the stage for Modon Holding’s future of becoming a leading player in the real estate arena. After the acquisition, Q Holding was branded as Modon Holding in its annual general meeting vote on 18 March 2024.

Modon Holding’s diversified portfolio spans various sectors and regions, enhancing the Group’s resilience. Modon Holding is committed to advancing Abu Dhabi’s local and international ambition to align with the UAE’s vision for sustainable development.

The Group’s liquidity position surged by 119%, enabling Modon Holding to capitalise on strategic opportunities and drive further expansion and as of 30 June 2024, Modon Holding boasts a market capitalisation of $12.51 billion, a y-o-y growth of 114%.

Supported by solid demand for new projects and existing inventory, the company reported strong real estate sales momentum of $2.07 billion in H1 of 2024 and 153% increase y-o-y sales booked. AED 22.3 billion aggregated revenue backlog across the Group.

Borouge’s Performance

Borouge Plc has reported a 33% year-on-year (YoY) increase in second-quarter net profit to $308 million, powered by higher sales and cost efficiencies as the company recorded its highest ever production volumes.

Adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) surged 18% y-o-y to $613 million in the second quarter, underpinned by a 6% increase in revenue and a 6% improvement in cost per tonne, reflecting sustained efficiencies from the Value Enhancement Programme (VEP) that delivered a $607 million positive impact in 2023.

Borouge maintained its industry leadership in profitability, with an EBITDA margin of 41% in Q2, up from 37% a year earlier.

A key driver of Borouge’s industry-leading profitability is its sustained price premia for polyethylene and polypropylene, which remained robust at $198 and $138 per tonne respectively in Q2. This was in line with the company’s mid-term through-the-cycle guidance, which was reiterated by management.

Borouge achieved record quarterly production levels, driven by outstanding capacity utilisation rates of 114% for polyethylene and 103% for polypropylene, supported by an ongoing focus on process safety and asset reliability, which stood at 97% in Q2.

For the first half of 2024, Borouge reported a net profit of $581 million, an increase of 35% y-o-y, with adjusted EBITDA increasing 21% to $1.18 billion. H1 revenue of $2.81 billion was unchanged from a year earlier, while costs, excluding depreciation and amortisation, decreased 11% through a continued commitment to rigorous cost management.

Global Growth

Accelerating its international growth ambitions, Borouge announced in July the initiation of a feasibility study for a speciality polyolefins complex in China.

Borouge is part of a consortium that intends to form a 50:50 joint venture with Wanrong New Material (Fujian), a subsidiary controlled by Wanhua Chemical, to establish a plant in Fuzhou with a capacity of 1.6 million tonnes per year.

In the UAE, the company has reached over 70% completion of the Borouge 4 facility mega project, which will increase production capacity by 28%, making Al Ruwais Industrial City the largest integrated single-site polyolefin complex in the world.

The project, being built by Borouge on behalf of the project’s owners, ADNOC and Borealis, is on schedule for completion at the end of 2025 and is projected to generate an additional $1.5 billion – $1.9 billion in annual revenue. Upon completion, the project is expected to be transferred to Borouge from its majority shareholders, ADNOC and Borealis.

Borouge is also advancing capacity increase plans at its second ethylene unit (EU2), aimed at raising production of olefins and polyolefins by a further 230,000 tonnes. Scheduled for completion in 2028, the additional capacity is expected to contribute $220 – $250 million in annual revenue.