ADNOC Logistics & Services (ADNOCLS) Q2 2024 earnings summary

Executive summary

• H1 2024 revenue rose 42% year-over-year to $1.74 billion, net profit up 31% to $401 million, and EBITDA up 42% to $591 million, maintaining a 34% margin, driven by transformational growth strategy and strategic investments.

• Q2 2024 revenue increased 42% year-over-year to $899 million, net profit grew 28% to $208 million, and EBITDA rose 40% to $306 million.

• Guidance for 2024 revised upward: revenue growth now expected in the low to mid-30% range year-over-year, with EBITDA growth in the low 30% range.

• Acquisition of 80% in Navig8 for $1.04bn, expanding global reach and service offerings, expected to be over 20% EPS accretive in the first full year.

• Over $5 billion in strategic investments targeted by 2028, with more than 50% already committed post-IPO.

Financial highlights

• H1 2024: revenue $1.74bn (+42% YoY), EBITDA $591m (+42% YoY, 34% margin), net profit $401m (+31% YoY).

• Q2 2024: revenue $899m (+42% YoY, +7% QoQ), net profit $208m (+28% YoY, +7% QoQ), EBITDA $306m (+40% YoY, +7% QoQ).

• EPS for H1 2024: $0.05 (+31% YoY); free cash flow: $308m (+263% YoY); net cash from operating activities: $577m (+91% YoY).

• Net debt remains negative, providing ample capacity for future debt financing.

• Capital expenditures for H1 2024: $225m (+3% YoY).

Outlook and guidance

• 2024 revenue growth guidance raised to low to mid-30% YoY; EBITDA growth in low 30% range; net income growth expected in low 20% range.

• Integrated Logistics: mid-40% YoY revenue growth in 2024, mid to high single-digit growth medium term.

• Shipping: low to mid-teens YoY revenue growth in 2024; Gas Carriers to see mid-20% growth 2025-27 with new LNG vessels.

• Marine Services: mid single-digit YoY revenue growth in 2024, stable medium-term outlook.

• Group medium-term: high single-digit revenue growth, mid-teens EBITDA and net income growth.