Adnoc Drilling H1 net profit soars 34% to $379m

Adnoc Drilling on Tuesday reported solid growth in first half net profit by 34 per cent to $379 million and increase in revenue by 13 per cent to $1.27 billion compared to the same period of last year.

Adnoc Drilling is a fully owned subsidiary of the Abu Dhabi National Oil Company (Adnoc). Its first half earnings before interest, taxes, depreciation and amortisation (Ebitda) was $580 million, up 16 per cent year-on-year basis, with a market-leading margin of 45.7 per cent, as the company made exceptional progress on delivering further cost savings.

“Adnoc Drilling has continued to make strong progress in 2022 delivering on its promises to continue growing the business and maximising returns for our shareholders. Excellent half year results and successful strategic execution are testament to the vital role that the company is playing in enabling significant production capacity growth for Adnoc as well as the UAE’s objective to achieve gas self-sufficiency,” said Dr Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology, Adnoc Managing Director and Group CEO, and Chairman of Adnoc Drilling.

Year-on-year revenue growth was led by the onshore segment and its Oilfield Services (OFS) segment also achieved strong year-on-year gains. The second quarter revenue grew 11 per cent year-on-year to $669 million, driven primarily by the onshore and OFS segments. The second quarter Ebitda increased by 7 per cent from the previous quarter as it climbed to $300 million for the period.

Also, net profit for the second quarter grew 17 per cent from the previous quarter and by 19 per cent year-on-year, to $204 million.

Abdulrahman Abdullah Al Seiari, CEO, Adnoc Drilling, said these results were enabled by our clear strategic objectives, the commitment of our highly-skilled and dedicated workforce and our unwavering commitment to industry-leading health and safety standards.

The Abu Dhabi-headquartered firm is the largest national drilling company in the Middle East by rig fleet size. It reported a fleet utilisation rate of 98 per cent for the half year to June 30, 2022. The company’s bold rig fleet expansion programme gained further momentum in the first half of this year, with eight rigs added to the fleet.

Five Helmerick & Payne FlexRigs were added in the first quarter and sale and purchase agreements were signed for three premium offshore jack-ups in the second quarter. The total value of these acquisitions forms part of the company’s three-year capital expenditure guidance of $2.5-3 billion, as well as its strategic roadmap to grow the fleet to 122 rigs by the end of 2024.

“Our fleet expansion programme has gained real momentum and is central to our dynamic growth strategy. The rigs we have added to our fleet in H1 22 will support us in delivering on our resolute commitments to our shareholders, including Adnoc, as it works towards its production capacity targets and gas self-sufficiency for the UAE,” Al Seiari underlined.

The board of directors approved an increased interim dividend of 5 per cent.

“As part of the previously announced dividend policy, the board is pleased to confirm the interim dividend per share will reflect a 5 per cent increase to 7.83 fils, bringing the first payment of fiscal year 2022 to $341 million,” Dr Al Jaber added.

Meanwhile, Adnoc Drilling’s bold fleet expansion programme enables the company to support a growing number of world-scale projects in the UAE, as seen by several significant contract awards in recent weeks.

On July 27, Adnoc Drilling was awarded $2 billion in contracts for offshore drilling units and Integrated Drilling Services (IDS) to support the delivery of Adnoc’s Ghasha offshore gas mega project.

On August 5, the company confirmed the agreement of contracts to the value of an additional $3.4 billion for 8 high-specification premium jack-up rigs to support Adnoc Offshore drilling operations.

— ashwani@khaleejtimes.com