TAQA, also recognized as Abu Dhabi National Energy Company announced a half-year net income of AED 13.5B. A significant gain of AED 10.8 billion, derived from acquiring a 5 percent share in ADNOC Gas, primarily drove this.
However, a one-time AED 1.2 billion deferred tax liability, connected to the implementation of UAE corporate income tax, partially counterbalanced the net income.
However, when excluding these exceptional occurrences, TAQA’s earnings dropped by 9 per cent to AED 3.9B, according to Gulf Business.
Factors Driving Revenue Growth
Reduced contributions from the oil and gas sector drove this decrease. The company reported revenues of AED 26.8B in the first six months of the year, a 5 per cent rise compared to the previous year.
This was attributed to higher pass-through bulk supply tariffs and increased utilization of the system within the group’s transmission and distribution segment.
TAQA’s board of directors announced a second interim cash dividend of 0.65 fils per share (approximately AED 731M), aligning with the company’s new dividend policy. Earnings before interest, taxes, depreciation, and amortization (EBITDA) for the period declined by 7 per cent to Dhs10.5 billion, primarily due to decreased contributions from the oil and gas portfolio.
The company’s free cash flow for the first half of 2023 amounted to AED 6.4B, representing a 23 per cent decrease compared to the same period in the previous year. Despite this, TAQA’s gross debt remained unchanged at AED 61.7B, consistent with the outstanding amount at the end of 2022.
Strategic Expansion and Collaborations
“Demonstrating its commitment to continued growth, the company announced the expansion of its portfolio through its plan to acquire SWS Holding. This transaction will broaden the scope of TAQA’s activity in the regulated utility business by becoming a fully integrated water and wastewater treatment provider,” said Mohamed Hassan Alsuwaidi, chairman of TAQA.
In June, TAQA, ENGIE, and Emirates Water and Electricity Company (EWEC) secured funding amounting to AED 2.3B for the low-carbon Mirfa 2 reverse osmosis (RO) desalination venture in Abu Dhabi.
The forthcoming desalination facility, expected to commence operations in the fourth quarter of 2025, is primarily owned by TAQA (60 percent), with ENGIE holding a 40 percent ownership share. In addition, TAQA will have a 40 per cent stake in the project’s operations and maintenance (O&M) entity.
Furthermore, the company joined forces with Uzbekistan to explore investment prospects within the energy sector of the Central Asian nation. These investment opportunities encompass both new and existing power facilities, as well as related power infrastructure, collectively valued at over AED 11B.
In another collaboration, the Abu Dhabi-based firm partnered with ADNOC Group to offer sustainable water supply to the oil company’s onshore operations. This venture holds a value of AED 8.8B. The two entities jointly hold the majority ownership of the project, each possessing a 25.5 percent share (totalling 51 percent). A consortium consisting of Orascom Construction and Metito holds the remaining 49 percent share.