TAQA Group posts Dhs15bn in nine-month net income

TAQA, also known as Abu Dhabi National Energy Company, has posted Dhs15bn in nine-month net income, an increase of Dhs8.5bn, driven by a one-off gain of Dhs10.8bn recognised on the acquisition of a 5 per cent shareholding in ADNOC Gas.

Net income was offset, in part, by a one-off Dhs1.2bn deferred tax liability associated with the introduction of UAE corporate income tax from January 1, 2024.

TAQA’s revenues during the period under review remain unchanged at Dhs39.5bn as higher pass-through bulk supply tariffs and transmission use of systems within the group’s transmission and distribution segment offset a decline in oil and gas revenue.

However, the decrease in oil and gas revenues on the back of lower prices and ongoing OPEC+ production cuts contributed to a plunge in the group’s earnings before interests, taxes, depreciation and amortisation by 11 per cent to Dhs15.3bn.

“In the first nine months of 2023, TAQA remained unwavering in its commitment to creating long-term shareholder value, delivering a steady performance on the back of strong returns from the group’s utility business despite headwinds caused by fluctuations in commodity prices and the enforced shutdown of our production in Iraq,” Jasim Husain Thabet, TAQA’s Group CEO and managing director said in a statement.

The company’s board of directors declared a third interim cash dividend for the year of 0.65 fils per share (approximately Dhs731m).

TAQA’s free cash flow in the nine months to September 30 stood at Dhs10.2bn, down 20 per cent from the same period a year earlier while its gross debt of Dhs61.7bn remains unchanged on the amount outstanding at the end of 2022.

TAQA’s growth strategy

TAQA’s capital expenditure in the first nine months of the year was Dhs3.3bn, up 34 per cent from the previous year as project execution picked up pace in the group’s transmission and distribution segment.

Building on its 2021 growth strategy, TAQA aims to deliver 150 gigawatts (GW) of gross power generation by 2030, up from the previous target of 50 GW, with around 65 per cent of its generation capacity coming from renewable power sources.

The utility firm had initially committed to a target of 30 per cent but the group has upgraded this target on the back of its “leading” stake in Abu Dhabi clean energy firm, Masdar.

TAQA is ramping up its growth targets for water generation as well with a plan to increase the group’s water generation capacity to 1,300 imperial gallons per day (MIGD), with two-thirds of this capacity coming from efficient and low carbon reverse osmosis (RO) technology.

Earlier in June, TAQA, ENGIE and Emirates Water and Electricity Company secured Dhs2.3bn in funding for the low-carbon Mirfa 2 RO desalination project in Abu Dhabi. The company currently has a desalination capacity of just over 1,180 MIGD.

With a market capitalisation of Dhs364.3bn as of November 13, the utility firm plans to invest Dhs75bn by 2030 to expand its power and water capacity, and UAE-based transmission and distribution networks.

Read: Abu Dhabi’s Masdar lists $750m green bond on ADX