Abu Dhabi National Energy Company (TAQA) Q4 2023 earnings summary

Executive summary

• FY2023 revenue rose 3% to AED 51.7bn; adjusted EBITDA fell 6% to AED 19.6bn, while attributable net income rose 107% to AED 16.7bn, mainly due to a one-off ADNOC Gas stake gain.

• Excluding one-off items, net income was AED 7bn, down 13%; growth in T&D and Generation was offset by weaker Oil & Gas results.

• 2030 targets expanded to 150GW gross power capacity and AED 75bn of planned investment.

Financial highlights

• FY2023 revenue was AED 51.7bn, up 3%; adjusted EBITDA was AED 19.6bn, down 6%, mainly reflecting lower realised oil and gas prices and reduced production.

• Attributable net income reached AED 16.647bn, up 107%; excluding the AED 10.8bn ADNOC Gas gain and AED 1.1bn deferred tax charge, net income was AED 7bn, down 13%.

• Operating cash flow less investing cash flow was AED 13.9bn, up 0.6%; CAPEX rose 34% to AED 5.1bn.

• Q4 revenue rose 8% YoY, adjusted EBITDA fell 0.3%, attributable net income increased 256%, and free cash flow rose 5%.

Outlook and guidance

• 2030 gross power capacity target tripled to 150GW, including 100GW of renewables through Masdar; net power capacity target is 50GW.

• 2030 water generation capacity target is 1,300 MIGD; renewables are targeted to provide ~65% of generation, versus 45% at end-2023.

• Planned AED 75bn investment comprises AED 40bn for UAE T&D and AED 35bn for Generation; 55% of Generation spend is expected to go to Masdar.

• Over two-thirds of water generation capacity is targeted to use reverse osmosis technology.

• RC2 parameters include a 4.9% real WACC and ~AED 14.5bn aggregate CAPEX allowance for 2023–2026.