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Saturday, August 13, 2022

AD Ports Group Q2 2022 Net Profit Surged 59% YoY

 

AD Ports Group Q2 2022 Net Profit Surged 59% YoY

·         Revenue grew by 35% YoYto AED 1,242 million driven by the Maritime and EC&FZ clusters

·         EBITDA increased by 41% YoY to AED 532million

·         Net Profit surged 59% YoY to AED 300 million

·         Capex reached AED 1.6 billion, in line with the Group’s capital investment plans to spend more than AED 15 billionacross all clusters over the 2022-26 period

·         Net leverage stood at 0.9x, leaving ample room for further organic and inorganic growth; USD 1 billion RCF remains unutilised

·         Container volumes grew by 30%YoY while Ro-Ro and cruise passenger volumes continued their healthy recovery post COVID-19 disruptions

·         Record 3.9km2 of new land leases signed during H1 2022 - more than the annual land leases signed in each of 2021 and 2020



·         FTSE Emerging MarketsIndex inclusion in June 2022

 


Abu Dhabi, UAE - 12August, 2022:AD Ports

Group today announced its financial results for thequarter ended 30June 2022.

The Group’s revenue grew 35% YoY to AED 1,242 millionin Q22022(+25% YoY growth in H12022), achieving record results for H1 growthmainly driven by the Maritime and Economic Cities &Free Zones (EC&FZ)Clusters, and to a lesser extent by the Digital Cluster.

 

The Ports Cluster Q2 2022 revenue performance was hampered by an unfavourable base effect from the one-off sand supply contract that ran from March until October 2021. However, on a like-for-like (LFL) basis, the Ports Cluster revenue grew by 20% YoY in Q2 2022.

EBITDAincreased 41% YoY to AED 532 millionin Q22022(+37% YoY growth in H12022), with EBITDA margin improving by close to 200 bps to 42.8%. With the continued ramp-up of operations across all clusters, and barring one-off negative impacts, the Group’s EBITDA performance should continue to be supported by higher operating leverage going forward. 

Net Profit growth accelerated to 59% YoY reaching AED 300 millionin Q22022(+49% YoY growth in H12022) despite higher depreciation charges and higher finance costs from the ongoing investment program as well as higher provisions for ECL (Expected Credit Loss).

The 22.32% stake in Aramex, which was transferred to AD Ports Group in January 2022, contributed AED 12 million to EBITDA and Net Profit in Q22022 (AED 23 million in H12022).

Consolidated capital expenditure during Q2 2022reachedAED 1.6 billion(AED 2.6 billion in H12022 vs. AED 1.1 billion in H12021), withthe three main recipients by order of quantum being the Maritime Cluster (vessel fleet expansion), the Ports Cluster (Khalifa Port expansion and Etihad Rail connectivity), and the Economic Cities &Free ZonesCluster (new warehouses, gas network expansion and infrastructure-related investments to unlock additional land).

AD Ports Group maintains a robust capital structure with adequate liquidity and investment grade credit ratings to cater to its future growth. As of Q2 2002, the Group had total debt of AED 3.6 billion in the form of 10-year bonds that were issued under an EMTN Programme in 2021 and a cash position of AED 1.8 billion, translating into a net leverage of 0.9x. The Group has a well-managed debt maturity profile with adequate liquidity lines. The USD 1 billion syndicated revolving credit facility (RCF) with a consortium of local and international banks secured in 2021remains unutilised.The strategy continues to be to utilize bonds as the predominant long-term funding vehicle with the RCF serving as a liquidity backstop.

In June 2022, AD Ports Group reached an agreement with National Marine Dredging Company (NMDC) to launch a new JV, SAFEEN Surveys and Subsea Services. The new company will offer offshore surveys and subsea services, including commercial diving services and unmanned vessel inspections, in the UAE, the GCC, and some international markets. In addition, the JV will provide innovative solutions to meet the needs of offshore operations related to the oil and gas and renewable energy sectors.

In the same month,AD Ports Group announced its first international acquisition in Egyptwith the purchase of a 70% stake in International Associated Cargo Carrier (IACC), which fully owns Transmar International Shipping Company and Transcargo International (TCI) - a regional container shipping company that operates across the Middle East, Red Sea, Arabian Gulf and Eastern Coast of Africa and a terminal operator and stevedoring company, mainly operating out of the Adabiya Port, where it is the exclusive container operator, respectively.

In July 2022, AD Ports Group launched a joint venture with SEG, one of the largest oil and gas companies in Uzbekistan, to open new logistics and freight businesses and signed a Memorandum of Understanding to develop a food storage and distribution hub to enhance Uzbekistan’s food trade across global markets anddrive Central Asian food security.

Captain Mohamed Juma Al Shamisi, Managing Director and Group CEO, AD Ports Group, said:“The momentum of our growth journey has acceleratedthroughout the first half of the year, and we anticipate continuing to deliver on our performance for the remainder of the year.We are grateful to our wise leadership for their unwavering support towards our endeavours that seek to drive the economic growth, diversification, and industrialisation of the UAE. The Group’s core businesses have continued to rebound from the severe supply chain disruptions of last year while ournew ventures, enhanced service offering, and diversification strategy into synergistic new businesseshave been yielding positive results.

In Q2 2022, we continued to invest heavily in order to deliver future growth.Moreover, we have also benefitted from the macro picture in the Gulf region, and in the UAE in particular. Not only have oil prices been increasing sharply, which has accelerated the country’s economic growth, including the non-oil economy,but AD Ports Group is also well-positioned to be one of the key beneficiaries of Abu Dhabi’sIndustrial Strategy, which aims to more than double the size of its manufacturing sector to AED 172 billion by 2031.

More generally, AD Ports Group has been strategically aligning its business with many of the emirate and the country’s long-term objectives, including Abu Dhabi’s IndustrialStrategy, the UAE’s Net-Zero by 2050 strategic initiative, and the country’s National Food Security Strategy 2051.”

Ross Thompson, Group Chief Strategy and Growth Officer, AD Ports Group,said: “Global markets are still turbulent with a high inflation environment, rising interest rates, geopolitical tensions as well as continued ramifications of the COVID-19 pandemic, including supply chain disruptions and supply shortages.

Therefore, pressure on global trade volumes is increasing with macroeconomic headwinds, lockdowns in China and a ‘cost of living crisis’ but has been largely offset by post COVID-19 pent-up demand for goods for the time being.As a result, global seaborne container trade volumes decreased around 2.5% in H1 2022, with full-year forecasts expected to finish higher at near 1% YoY growth.

On the other hand, shipping rates remain at extraordinary levels and their outlook for the rest of the year remains positive, with continuing disruptions providing support despite trade headwinds.

 


In this challenging global context, our unique integrated business model, built upon a firm foundation of long-term contracted revenues, offers good revenue stability and visibility while our extensive investment programme, both organically and through acquisitions, provides a healthy growth platform.”

-       END -

 

About AD Ports Group:

Established in 2006, AD Ports Group today serves as the region’s premier facilitator of logistics, industry, and trade, as well as a bridge linking Abu Dhabi to the world. Listed on the Abu Dhabi Securities Exchange (ADX: ADPORTS), AD Ports Group’s vertically integrated business approach has proven instrumental in driving the emirate’s economic development over the past decade.

Operating several clusters covering Ports, Economic Cities & Free Zones, Maritime, Logistics, and Digital, AD Ports Group’s portfolio comprises 10 ports and terminals, and more than 550 square kilometres of economic zones within KIZAD, the largest integrated trade, logistics, and industrial business grouping in the Middle East.

AD Ports Group is rated A+ by S&P andA+Outlook Stable by Fitch.

 

For more information, please visit: adportsgroup.com

 

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