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Fleet expansion drives Adnoc Drilling profits

10 August 2023

Adnoc Drilling has posted a net income of $228m in the second quarter of this year, up 12 per cent year-on-year and 4 per cent compared to the first quarter.

The oil and gas drilling services business of Abu Dhabi National Oil Company (Adnoc Group) reported that its second-quarter revenue grew by 8 per cent year-on-year to $724m and by 1 per cent sequentially.

Earnings before interest, taxes, depreciation and amortisation (Ebitda) in the second quarter increased by 15 per cent year-on-year to $344m, leading to a 48 per cent Ebitda margin, or three percentage points higher year-on-year. Ebitda also increased by 3 per cent sequentially.

Adnoc Drilling also announced its financial results for the year’s first half. The company registered a 13 per cent year-on-year growth in its revenue in the first half, at $1.4bn. Revenue growth was driven by the oil field services and offshore jack-up segments, which increased by 45 per cent and 31 per cent, respectively.

The Abu Dhabi Securities Exchange-listed company’s net profit in the first half stood at $446m, a year-on-year growth of 18 per cent.

First-half Ebitda increased by 17 per cent year-on-year to $677m, leading to an Ebitda margin of 47 per cent.

ALSO READ: Adnoc completes well drilling at CO2 reduction project

“Adnoc Drilling’s financial performance in the first half of 2023 is testament to our strategy of expanding both our drilling fleet and service offering, while also improving our margins through strong cost performance,” Abdulrahman Abdulla al-Seiari, CEO of Adnoc Drilling, commented.

“Oil field services revenues grew by 45 per cent year-on-year with improved margins. Moreover, we progressed on our goal to expand the fleet, signing agreements to build 16 hybrid powered land rigs, which also form a significant additional element of our decarbonisation strategy,” he added.

During the first half of 2023, Adnoc Drilling announced signing contracts worth over $2.4bn, consisting of a $2bn offshore jack-up contract award and a $412m integrated drilling services contract.

The company also signed sale and purchase agreements to acquire two premium offshore jack-ups and 16 newbuild hybrid power land rigs.

Adnoc Drilling’s interim dividend for the current year is expected to increase by a minimum of 5 per cent versus last year and will be “announced in due course”, with payments to be made by end-October.

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Indrajit Sen

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