Abu Dhabi’s ADNOC Distribution said on Monday that it remains committed to keeping operating costs low this year even as profits for the first three months of the year have soared by more than 57 percent.
The UAE-listed subsidiary of Abu Dhabi National Oil Company (ADNOC) reported a net profit of 631 million dirhams ($171.8 million) for the first quarter of 2021, up from 400 million during the same period last year.
The fuel and convenience retailer said it posted a strong financial performance on the back of improved margins and greater efficiency in operating expenses (OPEX), which fell by 6.5 percent during the quarter compared to a year earlier.
“As part of the company’s ongoing transformation, it remains committed to reducing operating costs and ensuring continued competitiveness in the UAE fuel retail and convenience store sector,” the company said.
“Reduction in operating costs were achieved despite growth in the company’s retail network and were driven by management initiatives to optimise OPEX across business units.”
Last year, the company opened 64 new stations across the UAE, a ten-fold increase in delivery compared to the previous year. Four new stations opened during the first quarter of 2021, with several others slated to open before the end of the year.
“The company intends to accelerate delivery momentum and remains on track to meet its guidance to open a total of 70 to 80 new stations across the UAE and [Saudi Arabia] by year end, of which 30 to 35 are expected to be opened in the UAE,” the company said.
As of March 31, 2021, the company’s liquidity stood at 5.1 billion dirhams, with 2.3 billion dirhams held in cash and cash equivalents and 2.8 billion dirhams in unutilised credit facility.
“ADNOC Distribution maintains a strong financial position, with a robust balance sheet at the end of the first quarter of 2021. The company remains well positioned to expand both its domestic and international portfolio,” it said.
(Writing by Cleofe Maceda; editing by Seban Scaria)
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© ZAWYA 2021