ADNOC Gas Net Income Soars 11% to $1.24 Billion

ADNOC Gas plc and its subsidiaries (collectively "ADNOC Gas" or the "Company") (ABU Dhabi Stock Exchange code: ADNOCGAS) (International Securities Identification Code: AEE01195A234, a world-class integrated natural gas processor, today announced strong financial results for the third quarter of 2024, with net revenue up 11% year-over-year to $1.24 billion, exceeding Bloomberg's expectations for the quarter.

In conjunction with the announcement of third quarter results, ADNOC Gas' Board of directors approved a new growth strategy. The strategy aims to increase EBITDA by more than 40% by 2029 and plans to invest up to $15 billion in capital expenditures (CAPEX) between 2025 and 2029.

Dr. Ahmed Alebri, Chief Executive Officer of ADNOC Gas, said: "The third quarter results demonstrate our solid performance and our updated strategy is designed to secure the future of the business with the target of achieving EBITDA growth of more than 40% by 2029. We are committed to delivering superior value returns to our shareholders through ambitious growth plans and an expected 5% annual dividend growth.

By advancing our projects and optimising existing assets, we will continue to help diversify the UAE's industry and supply more gas to domestic customers through our expanding infrastructure."

In addition, through our decarbonization initiatives, we will help meet the growing global demand for low-carbon Gas, making ADNOC Gas a leader in the global sustainable gas industry, "added Dr. Alebri.

ADNOC Gas revenue rose to $6.281 billion in the third quarter, up 8% year-over-year and exceeding $6 billion for the fourth consecutive quarter. Higher sales volumes and an improved price environment for export trade liquids contributed to the increase in performance. EBITDA increased 18% year-over-year to $2.205 billion, and EBITDA margin continued to be strong at 35%. Free cash flow was $1.184 billion.

For the first nine months of 2024, net revenue increased 18% year-over-year to $3.62 billion. This result was driven by a 6.5% increase in export trade liquids and liquefied natural gas (LNG) sales, a 4.5% increase in sales of natural gas, and a 3.5% increase in domestic natural gas sales. Results for the first nine months were further boosted by higher prices for liquefied petroleum gas (LPG) and liquefied natural gas (LNG). As a result, EBITDA for the first nine months of the year reached $6.37 billion, an increase of 18% year-on-year.

In the UAE, annual growth in gas demand is expected to reach 6% until 2030, compared to 2% expected at the time of the initial public offering (IPO). Increased economic activity, population growth, and industrial expansion will drive strong growth in demand, with AI data centers and the food industry underpinning this growth.

To capture this new demand growth opportunity, ADNOC Gas plans to increase its capital expenditure from $13 billion to $15 billion between 2025 and 2029, which will drive EBITDA growth of more than 40% by 2029.

All ADNOC Gas projects are subject to strict capital discipline, which has resulted in the transfer of capex for the ESTIDAMA pipeline network project and the Habshan CO2 recovery project to the ADNOC Group. Both projects will continue to be managed and operated by ADNOC Gas. At the same time, the LNG 2.0 project, the renovation and expansion of Das Island, has been cancelled.

ADNOC Gas's main focus until 2029 will be on the development and delivery of three large projects under construction (FID, after the final investment decision). These projects include: Ethane Recovery and Monetization Maximization (MERAM) project, which is expected to provide up to 3.4 million tons of ethane and NGL production capacity per year; The IGD-E2 project, which will have a natural gas processing capacity of 370 million standard cubic feet per day; And the Ruwais LNG project, which is expected to have a maximum LNG production capacity of 9.6 million tons per year.

The updated growth strategy also includes advancing design and concept studies for large pre-FID projects to accommodate the significant increase in the company's Gas processing capacity resulting from ADNOC's upstream capacity expansion, as well as the Bab Gas Cap project, which is expected to be completed after 2029.