ADNOC Drilling approves $788mln 2024 dividend, accelerates AI-enabled expansion
ABU DHABI - ADNOC Drilling Company PJSC confirmed shareholders' approval of all agenda items at its Annual General Meeting, including the distribution of its final cash dividend payment for the year ended 31st December 2024.
ADNOC Drilling's full-year revenue increased significantly to a record $4.034 billion, rising by 32% year-on-year and its full-year EBITDA reached a record high of $2.01 billion, up 36% year-on-year. Since the Company's listing on ADX in 2021, its net profit for the full year has more than doubled, culminating in $1.30 billion in 2024.
By leveraging the strength of its balance sheet, the Company remains committed to pursuing smart growth, seizing new opportunities and maximising shareholder value over the long term.
Abdulrahman Abdulla Al Seiari, ADNOC Drilling CEO, said, 'Our record-breaking financial performance and dividend reflect ADNOC Drilling's strong momentum as the world's fastest growing energy services company. With a 10% dividend increase to $788 million in 2024 and a commitment to further increase it by at least 10% in 2025 and beyond, we continue to deliver exceptional value to our shareholders while investing in the future.
Our targeted expansion across the region, AI-powered rigs and cutting-edge oilfield services position us for even greater success. As we accelerate innovation through Enersol and unlock Abu Dhabi's unconventional energy potential through Turnwell, ADNOC Drilling remains at the forefront of the industry – driving efficiency, sustainability and long-term progressive returns for our shareholders.'
The final shareholder-approved cash dividend payment for 2024 amounts to $394 million (c.9.05 fils per share). This brings the total 2024 dividend to $788 million (c.18.1 fils per share), representing a 10% year-on-year increase versus 2023. The dividend will be paid on or around 11th April 2025, to all shareholders of record as of 27th March 2025.
Looking ahead, the dividend is expected to increase to at least $867 million for 2025, reaching at least $1.15 billion by 2028, based on the minimum 10% year-on-year increase, in line with the Company's progressive dividend policy. The policy grants the Board of Directors discretion to distribute additional dividends above this floor, reaffirming ADNOC Drilling's commitment to maximising growth and returns for its shareholders.
This growth trajectory is supported by the Company's fleet expansion, projected revenue growth and robust returns, including return on average capital employed (ROACE), which in 2024 exceeded 20% as well as return on equity (ROE) surpassed 30%.
Additionally, ADNOC Drilling expects substantial free cash flow of up to $1.6 billion in 2025and net income growth with an implied payout ratio of less than 65% at the dividend floor in 2025. This strategic approach positions ADNOC Drilling for significant financial and operational success in the coming years.
In 2025, ADNOC Drilling is set to enhance its operational capacity, projecting a rig count of over 148 by 2026 and more than 151 by 2028. The introduction of advanced rigs with AI-enabled technologies will enhance efficiency and bolster its oilfield services (OFS) segment, delivering greater value to customers. Having extended its contract in Jordan and gained prequalification in Kuwait and Oman, ADNOC Drilling continues to pave the way for further regional expansion in 2025.
To date, Enersol, its joint venture with Alpha Dhabi, has announced acquisitions worth c.$800 million to acquire majority stakes in four tech-enabled oilfield service companies, and looking ahead, it aims to solidify its position as an AI-centric investment company. Turnwell, ADNOC Drilling's joint venture with SLB and Patterson-UTI, which has delivered an accelerated total of 30 wells to date and continues to drive efficiencies across the value chain, is also well-positioned to enable the recovery of Abu Dhabi's unconventional resources to meet the global energy demand.
On the back of record 2024 financial results, ADNOC Drilling announced its full year 2025 guidance, reaffirming continued growth. Among the key guidance metrics, in 2025 the Company expects total revenue between $4.6 to $4.8 billion, and EBITDA of $2.15 to $2.3 billion with a margin range of 46%-48%. Net Profit is expected to be between $1.35 to $1.45 billion, with a margin range of 28%-30%.
Moreover, ADNOC Drilling expects CapEx of between $0.35 to $0.55 billion, free cash flow (excluding M&A) between $1.3 to $1.6 billion, and a dividend floor of $0.87 billion, while maintaining a conservative leverage target of up to 2.0x Net Debt / EBITDA.
ADNOC Drilling's medium-term guidance projects FY2026 revenue of around US$5 billion. The company expects a conventional EBITDA margin of around 50 percent, with conventional drilling margins exceeding 50 percent and oilfield services margins ranging between 22 and 26 percent in the medium term. ADNOC Drilling maintains a conservative long-term leverage target of up to 2.0x Net Debt/EBITDA, with a net working capital target of approximately 12 percent of revenue. Maintenance CapEx is projected at $200-$250 million per annum, excluding organic and inorganic growth CapEx. Additionally, the company aims to operate over 148 rigs by 2026 and exceed 151 rigs by 2028.
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