UAE’s TAQA Group posts $3.2bn in Q1 net income

TAQA, also known as Abu Dhabi National Energy Company, reported first-quarter net profits of $3.2bn (Dhs11.6bn), driven by robust returns from the company’s long-term contracted utilities business and its acquisition of a 5 per cent stake in ADNOC Gas.

Jasim Husain Thabet, TAQA’s group CEO and managing director, said, “TAQA Group has closed a positive first quarter for 2023 with a significant boost to our net income from our new stake in ADNOC Gas.”

The Abu Dhabi-listed firm said its revenues jumped 6 per cent in the first three months of the year to Dhs13.14bn, bolstered by higher bulk supply tariffs and transmission charges.

TAQA’s free cash flow in Q1 2023 stood at Dhs4.3bn, up 31 per cent from the same period a year earlier, despite higher capital expenditure – which rose by 26 per cent year-on-year to Dhs1.1bn.

TAQA Group reports AED 11.6 billion net income for Q1 2023 boosted by acquisition of 5% stake in ADNOC Gas. Recent strategic highlights include GHG emissions reductions, expansion into EV infrastructure, and the acquisition of additional stakes in the Taweelah B IWPP and ADNOC… pic.twitter.com/mtQetQI6iL

— TAQA (@TAQAGroup) May 15, 2023

The company gross debt dropped to Dhs59.8bn in Q1 2023 compared to Dhs61.7bn at the end of 2022, which signals the company’s improving credit metrics.

Similarly, TAQA and Engie signed a water purchase agreement with Emirates Water and Electricity Company in February for a 120 MIGD reverse osmosis plant in Abu Dhabi with financial close expected to follow shortly.

The company also acquired an additional 10 per cent stake in the Taweelah B Independent Power and Water Plant in Abu Dhabi and a 25 per cent stake in the plant’s operations and maintenance company.

TAQA drives sustainability

Meanwhile, TAQA said its fixed dividend will amount to 3.25 fils in 2023, 3.50 fils in 2024, and 3.75 fils in 2025 — all paid quarterly, much in the same way as its previous policy.

The company, whose shareholders approved a special dividend of 2.1 fils per share for FY2022 bringing total dividends to 5.1 fils, said an additional variable dividend, based on the profit from its oil and gas business, will be paid annually.

The utility firm issued a $1.5bn dual-tranche bond in April, its first green bond following the launch of its new green finance framework. TAQA unveiled its green finance framework for the issuance of green bonds, Sukuks, loans and other debt instruments earlier in April.

It said proceeds from the issuances will be used to finance eligible green projects including renewable energy, energy efficiency, sustainable water and wastewater management as well as clean transportation, terrestrial and aquatic biodiversity.

The company is also expanding into electric vehicle (EV) infrastructure following the formation of a mobility joint venture, E2Go, with ADNOC Distribution to build and operate charging stations in Abu Dhabi.

E2Go comes at an opportune time in the development of the UAE’s EV market, with an expected 70,000 charging points expected to be built in Abu Dhabi by 2030 to meet growing EV demand.

Read: Abu Dhabi’s TAQA sells $1.5bn in dual-tranche bonds