ADNOC Distribution Unveils Ambitious 5-Year Growth Strategy

Abu Dhabi, The Gulf Observer: ADNOC Distribution, a key player in the energy sector, revealed its robust 5-year growth strategy during an Investor Day event held in Abu Dhabi on Monday. Bader Saeed Al Lamki, the CEO of ADNOC Distribution, outlined the strategic vision, emphasizing three pivotal drivers: domestic growth, international platforms, and future-proofing the business to position itself as a multi-energy leader.

CEO Bader Saeed Al Lamki stated, “ADNOC Distribution’s new growth strategy is designed to capitalize on domestic and international opportunities while ensuring resilience through future-proofing measures. We are committed to becoming a multi-energy leader by expanding our portfolio of low-carbon energy solutions, including biofuels, electric vehicles (EV), and hydrogen, aligning with our commitment to the decarbonization of the transport industry.”

Key highlights from the operational objectives of the 5-year strategy (2024-2028) include:

• Network Expansion: Growing the ADNOC Distribution network to 1,000 service stations, marking a substantial 20% increase from the current 840 stations (as of 2023).
• Non-Fuel Transactions: Targeting a 50% increase in the number of non-fuel transactions, aiming to diversify revenue streams.
• Convenience Stores: Achieving a 25% increase in the number of convenience stores within the service stations.
• Franchise Models: Scaling up franchise and sub-franchise models with over 50 new franchise operations, providing a 2-3X yield compared to traditional rental models.
• Car Care Services: Evolving into a one-stop shop for car care by tripling the number of car washes, doubling the number of automotive oil changes, and expanding total car service offerings.
• Digital Enhancements: Launching new innovations and expanding digital enhancements, including seamless fueling through license plate recognition, in-car ordering through the ADNOC Distribution application, and exploring future subscription services.
• EV Charging Points: Targeting a minimum of 500 EV fast and superfast charging points, representing a 10X increase from 2023, to build a national network.
• Financial Commitments: Aiming for up to $50 million in like-for-like operational expenditure savings by 2028, with an annual allocation of $250 to $300 million for capital expenditure, 70% of which will be focused on growth.
• Dividend Policy: Proposing a new dividend policy that ensures a minimum of $700 million annually or at least 75% of net profit, whichever is higher, offering potential dividend upside from future earnings growth. The proposal is subject to shareholder approval at the Annual General Meeting in March.

ADNOC Distribution is resolute in its commitment to delivering EBITDA growth from 2024 to 2028 through key strategic initiatives, including capital reallocation, international platform expansion, and embracing new revenue streams in line with the global energy transition.