Tabreed Reports AED 2.4 Billion Revenue in 2023, Expands Internationally

Tabreed, the UAE's premier international district cooling provider, has announced its financial achievements for 2023, showcasing a robust performance across various metrics. The company reported a revenue of AED 2.4 billion, marking a 9 percent increase compared to the previous year. This financial upturn is further highlighted by a net profit attributable to the parent, before deferred tax, of AED 751 million. A significant factor contributing to this success is Tabreed's enhanced balance sheet, evidenced by an improved net debt/EBITDA ratio of 4.11x, down from 4.49x at the end of FY 2022.

Tabreed's financial health in 2023 was bolstered by effective cash generation and a decrease in gross debt, attributed to a proactive debt management strategy. Despite the challenges posed by a high interest rate environment, the company managed to reduce its net finance costs by 24 percent. With long-term contracts ensuring a steady cash flow, Tabreed reported net cash from operating activities at AED 1.31 billion and an 8 percent increase in free cash flows to AED 1.21 billion.

In light of these strong financial results and positive outlook, Tabreed's Board of Directors has recommended a record dividend payment of 15.5 fils per share in cash for 2023, up by 15 percent from the previous year. However, the introduction of UAE corporate tax law led to a one-off non-cash accounting impact, with a deferred tax liability of AED 359 million recognized, resulting in a reported net profit of AED 431 million for the year.

Tabreed's operational achievements in 2023 include adding 53k Refrigeration Tonnes (RT) of new connections across its portfolio both in the UAE and internationally. This expansion was primarily driven by organic growth in existing concession areas and new 'greenfield' plants. The company also made significant strides in its core markets within the UAE and GCC, adding connections across several countries and marking its entry into the India market through a strategic alliance with TATA Realty and Infrastructure Limited.

2023 also marked Tabreed's 25th Anniversary, during which it actively engaged in public events such as the World Utilities Congress and COP28. At COP28, Tabreed showcased its commitment to sustainability through various initiatives and partnerships, including signing an AED 600 million Green Revolving Credit Facility under its green financing framework.

Tabreed's sustainability efforts were further emphasized through the development of a new Geothermal district cooling plant in partnership with ADNOC in Masdar City. This initiative aligns with the UAE's 'Year of Sustainability' and demonstrates Tabreed's dedication to supporting Net-Zero targets through energy-efficient operations.

The company also announced two senior appointments within its Executive Management Team, with Nadia Bardawil taking on the role of Chief Legal Counsel and Philippe Coquelle joining as Chief Development Officer.

Khaled Abdulla Al Qubaisi, Tabreed’s Chairman, expressed optimism about the company's future direction, emphasizing its commitment to expansion opportunities that promise healthy returns for investors while benefiting communities and countries where it operates.

With inputs from WAM