ADNOC Distribution, the United Arab Emirates' leading fuel and convenience retailer, solidified its commitment to shareholder returns and future expansion with the approval of a new five-year dividend policy. This decision, ratified during the company's Annual General Assembly Meeting, underscores ADNOC Distribution's confidence in its financial strength and its ambitious growth plans.
The newly implemented policy guarantees a minimum annual dividend of $700 million for the next five years (2024-2028). This baseline figure can be further amplified, reaching up to 75% of the company's net profits if that amount surpasses $700 million. This approach assures investors of a consistent and attractive return on their investment while also enabling ADNOC Distribution to invest strategically in its growth initiatives.
ADNOC Distribution's financial prowess is evident. The company has consistently delivered on its dividend promises, generating a 90% return for shareholders since its initial public offering in 2017 through a combination of rising market value and dividends paid out. This impressive track record, coupled with the achievement of its $1 billion EBITDA target for 2023, instilled confidence in the new dividend policy.
Looking ahead, ADNOC Distribution is poised for significant expansion. The company aims to broaden its reach by increasing its service station network to 1,000 by 2028. This growth will be complemented by a 50% surge in non-fuel transactions and a 25% increase in convenience stores. This multi-pronged approach signifies a strategic shift towards becoming a prominent player not only in fuel retail but also in the convenience and mobility sectors.
Underpinning this growth strategy is a commitment to innovation and sustainability. ADNOC Distribution is a champion of artificial intelligence (AI) and digitalization, leveraging these technologies to optimize operations and enhance customer experiences. A prime example is the company's AI-powered Fill & Go system, which utilizes license plate recognition technology to streamline the refueling process. Furthermore, ADNOC Distribution prioritizes sustainability efforts, aiming to reduce carbon emissions from fuel delivery trucks by 10%.
The successful implementation of the new dividend policy signifies a win-win scenario for both ADNOC Distribution and its shareholders. Investors can expect a steady stream of returns, while the company secures the financial resources necessary to propel its ambitious growth trajectory. As ADNOC Distribution embraces innovation and sustainability, it is well-positioned to solidify its market dominance and emerge as a multifaceted leader in the energy and convenience landscape.