Higher fuel volumes push Adnoc Distribution's third-quarter profit up more than 21%

Adnoc Distribution, the UAE’s largest fuel and convenience retailer, has posted a 21.5 per cent annual increase in its third-quarter profit, driven by a surge in retail fuel volumes.

Net profit attributable to the company’s shareholders in the three months ended September climbed to $221 million, the Abu Dhabi National Oil Company unit said on Friday in a filing to the Abu Dhabi Securities Exchange, where its shares are traded.

Revenue for the three-month period was up 2.7 per cent, reaching $2.54 billion.

The company said it achieved record quarterly earnings before interest, taxes, depreciation and amortisation (Ebitda) – a key measure of profitability – of $319 million in the third quarter, up 15.9 per cent year on year.

The first nine months of the year also saw Adnoc Distribution achieve its highest Ebitda of $885 million, an increase of 12 per cent year on year, marking the company's strongest nine-month performance since listing in 2017, it said.

Net profit for the January to September period grew by 15.6 per cent over the same period last year, to $579 million. Revenue for the nine-month period was, however, down slightly at $7.2 billion.

The company said it also achieved its highest nine-month fuel volumes of 11.7 billion litres, marking a 5.9 per cent year on year increase.

“Adnoc Distribution’s record performance this year is a testament to the progress we have achieved to date against our five-year growth strategy, furthering our transformation into a mobility and convenience retail leader,” said Bader Al Lamki, chief executive of Adnoc Distribution.

“Our strongest quarterly Ebitda ever, combined with a rapidly expanding network, demonstrates the fundamental strength of our business and a firm belief in our long-term growth prospects."

Fuelling a growing nation: How Adnoc is powering UAE’s expansion

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Adnoc Distribution has 977 service stations – 562 in the UAE, 172 in Saudi Arabia, and 243 in Egypt. The company recently said it aims to increase the size of its service station network to 1,150 by 2028, 15 per cent more than the previous guidance of 1,000.

Non-fuel retail expansion

Non-fuel retail continued to deliver strong momentum for Adnoc Distribution in the third quarter, with gross profit growing annually by 14.7 per cent, the company said on Friday.

The company's financial results come a month after it announced a major revamp of its Adnoc Oasis convenience brand with the launch of Oasis by Adnoc, offering a premium ‘On-the-Gourmet’ concept. The move underpins the company’s strategy to elevate customer experience and boost the UAE's mobility retail sector.

The growth is complemented by company’s 382 Adnoc Oasis convenience stores, vehicle inspection centres, and other services including car wash and lube change. The company also has 368 EV charging points installed under the E2GO brand in the UAE.

"By focusing on non-fuel retail, including through a refreshed Oasis by Adnoc brand and our property network, we are building a flexible mobility and convenience platform responsive to evolving customer needs, while creating sustainable, long-term value for shareholders,” Mr Al Lamki said.

The confidence is reflected in the company's revised expansion targets and the extension of its dividend policy for an additional two years, he added.

Adnoc Distribution recently announced a proposed extension of its dividend policy to 2030, subject to shareholder approval, with payouts to now occur on a quarterly basis from the first quarter of 2026. The company last month approved an interim dividend of Dh1.285 billion for the first half of 2025.

The dividend extension and the shift to quarterly payments are expected to "offer upside" from future earnings growth while rewarding shareholders more frequently, the statement said. The announcement brings the company’s total announced dividend commitments to a minimum of $4.9 billion between 2023 and 2030, at an annual payout of $700 million or a minimum of 75 per cent of net profit, whichever is higher, it added.