AD Ports Group has announced its financial results for the third quarter of 2023, reporting a revenue growth of 189 per cent year-on-year (YoY) to AED 4.24 billion ($1.15 billion).
Four of the five clusters – Logistics, Maritime & Shipping, Ports, and EC&FZ – were key growth drivers of the top line, with 546 per cent, 264 per cent, 71 per cent, and 20 per cent YoY performance, respectively.
AD Ports Group Q3 2023 EBITDA rose by 28 per cent YoY to AED 759 million ($207 million), largely supported by the acquisition of Noatum and Karachi Gateway Terminal.
Higher contributions from the relatively lower-margin Maritime & Shipping and Logistics businesses resulted in further EBITDA margin dilution to 17.9 per cent for the quarter compared to 40.5 per cent in Q3 2022.
The Maritime & Shipping Cluster remained the Group’s biggest revenue contributor and has become the largest EBITDA contributor too, accounting for 56 per cent and 33 per cent in Q3 2023, respectively.
Total Net Profit surged by 20 per cent YoY to AED 403 million ($110 million) in Q3 2023, in line with EBITDA performance.
The Group’s negative Net Operating Cash Flows of AED 579 million ($157.6 million) were impacted by a temporary deterioration in working capital in relation with the vessel trading activities. The Group expects Net Operating Cash Flows to recoup this negative performance in Q4 2023 when the associated cash collection takes place.
The Group’s Capital Expenditures (CapEx) reached AED 800 million ($217.8 million) in Q3 2023, putting the total year-to-date (YTD) outlay at AED 3.65 billion ($994 million), in line with the Group’s front-loaded AED 15 billion ($4 billion) capex programme between 2023 and 2027 (five-year period).
Captain Mohamed Juma Al Shamisi, Managing Director and Group CEO, AD Ports Group, said: “AD Ports Group has achieved remarkable growth in Q3 2023, underpinned by our strategic M&A activities and our strong relationships with diverse local economies, looking beyond traditional terminal operations and toward collaborations.
“The robust top-line growth not only reflects our efforts to develop new trade routes, strengthen service offerings to our key trading partners, and invest in our key customers in global supply chains, but also stands as a clear indicator of our effective diversification strategy and operational excellence.
“It is clear that, despite geopolitical headwinds and challenges presented by shifting global supply chains, with the support of our wise leadership, our ambitious global growth trajectory is reshaping the industry landscape and delivering superior value to our stakeholders,” Shamisi added.
Martin Aarup, Group Chief Financial Officer, AD Ports Group, said: “Our financial results for Q3 2023 underscore the strength and resilience of AD Ports Group’s diversified business model, buoyed by a substantial increase in YoY revenue.
“Despite the EBITDA margin dilution due to the lower margin of Maritime & Shipping and Logistics businesses, our focused approach on vertical integration and operational scaling is yielding positive results.
“The temporary dip in Net Operating Cash Flows is related to our strategic investments and vessel trading activities and we anticipate a normalisation in our leverage and a rebound in cash flows in Q4,“ Aarup added.
The Maritime & Shipping Cluster reported a revenue growth of 264 per cent YoY to AED 2.44 billion ($664 million) while the Economic Cities & Free Zones Cluster reported a 20 per cent YoY growth to AED 443 million ($120.6 million)
The Ports Cluster reported Q3 2023 revenue growth of 71 per cent YoY to AED 487 million ($132.6 million). The Logistics Cluster saw revenue increase more than fivefold to AED 852 million ($232 million).