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Earnings season remains in full swing with Adnoc L&S recording impressive results this morning, and Saudi Logistics Services (SAL) and Nakilat also enjoying bottomline gains.
ADNOC LOGISTICS & SERVICES-
Adnoc L&S records strong results for 2Q and 1H 2024: The Abu Dhabi National Oil Company’s (Adnoc) logistics arm recorded a 28% y-o-y increase in net income to USD 207.7 mn in 2Q 2024, according to the company’s financial statements (pdf). The company’s revenues also saw a 42% y-o-y growth to USD 899.3 mn during the period.
On a six-month basis, Adnoc L&S’ bottomline climbed 31% y-o-y to USD 401.4 mn in 1H 2024, while revenues jumped 42% y-o-y to USD 1.74 bn, according to the statement.
Behind the numbers: The company attributes the strong performance to its growth strategy, which involves investing over USD 5 bn (AED 18.4 bn) in energy-related maritime logistics by 2028, according to an earnings release (pdf).
Adnoc L&S shelled out USD 6 bn in investments in 1H 2024, Adnoc L&S CEO Abdulkareem Al Masabi told Asharq Business in an interview (watch, runtime, 9:36). The investments include various acquisitions and several agreements aimed at boosting its low-carbon tanker fleet, Al Masabi said. The company has inked long-term contracts spanning some 340 years, expected to generate USD 10 bn in revenues for Adnoc L&S, he added.
Segment-by-segment breakdown: Adnoc L&S’ integrated logistics segment reported a 55% y-o-y growth in revenues to USD 1.132 bn (AED 4.1 bn), driven by increased transport volumes and improved contribution from jack-up barge segment due to an expanded fleet, increased rates, and enhance utilization. The outfit’s shipping segment saw a 27% surge in revenues to USD 519 mn, attributable to high charter rates for tankers and dry bulk as well as added earnings from Very Large Crude Carriers (VLCC). Marine services saw a 1% bump to USD 89 mn, attributed to boosted volumes in petroleum port operations and a marine terminal operations contract with Adnoc Offshore.
Recent acquisitions are paying off: The recent acquisition of Navig8 is expected to give Adnoc L&S a boost, with the first full FY following the acquisition expected to see a minimum 20% boost to its earning per share. The outfit also recently inked contracts worth USD 2.5 bn with South Korean shipyards, which are expected to boost the firm’s current fleet from 14 carriers to at least 22 vessels. AW Shipping — a JV between Adnoc L&S and Wanhua Chemical Group — placed a USD 1.9 bn order from China’s Jiangnan shipyard, which aims to enhance Adnoc’s capacity to transport lower-carbon energy sources.
Looking forward: The company aims to continue targeting value-accelerative investments to meet the wider global demand and deliver long-term value to shareholders, according to the statement.
SAUDI LOGISTICS SERVICES-
SAL Saudi Logistics Services’ net income leaped 42.8% y-o-y to SAR 155.5 mn in 2Q 2024, on the back of a boost in core operations and cost savings, it said in an earnings release (pdf). Meanwhile, revenues were up 19.5% to SAR 405.5 mn during the quarter, driven by a ramp up in e-commerce and general cargo volumes and an 88% spike in sales from the company’s logistics solutions segment.
On a 1H basis: SAL’s bottom line grew 70.7% y-o-y to SAR 363.9 mn in 1H 2024, while revenues were up 26.3% at SAR 858 mn.
Behind the numbers: The firm attributes its top line growth to the expansion of its cargo handling capacity, which has boosted its tonnage since last year, according to a Tawadul disclosure. SAL’s bottom line was driven up by a higher level of sales and a persistent focus on cost control. The company’s quarter-to-quarter performance drop was propelled by falling volumes of general cargo and e-commerce in Q2, according to the disclosure.
REMEMBER- SAL’s growth in 1Q was attributed to a 24% increase in booked business from the cargo handling segment — which accounted for 81% of overall revenues — along with an 89% hike in revenues from the logistics solutions segment which accounts for the remainder of overall revenues.
NAKILAT-
Nakilat had a good 2Q: Qatar Gas Transportation Company (Nakilat) saw a 7% y-o-y increase in its bottom line to QAR 829 mn in 1H 2024 while bringing in QAR 2.29 bn in revenues in the same period, according to a financial statement (pdf).
Behind the numbers: Nakilat has been working on expanding its fleet, placing a new order back in January for six advanced gas vessels from Hyundai Samho Heavy Industries. The firm’s fleet will reach 114 ships upon delivery of the ships on-order. QatarEnergy and Nakilat also inked a time-charter party agreement in March for the operation of 25 conventional size LNG vessels as part of the second ship-owner tender under QatarEnergy’s LNG Fleet Expansion program. They also inked a long-term agreement in May to charter and operate nine QC-Max LNG ships.
Looking forward: Nakilat announced in June that it intends to snap up an additional 20% stake in Qatar Shipyard Technology Solutions. The development comes after Nakilat’s partner in the JV, KSI Investments Limited, expressed a willingness to exit the investment and offload its stakes. Nakilat currently holds majority voting rights and a 79% share in the JV, and has expressed willingness to uptake KSI’s minority stake.
