ABU DHABI (WAM)
UAE’s leading international district cooling company, Tabreed, released its consolidated financial results for 2023 on Thursday, reporting revenue of Dh 2.4 billion, representing a 9% increase in comparison with 2022.
It also recorded a net profit of Dh 751 million, attributable to parent, before deferred tax. Additionally, its balance sheet showed further improvement, showcasing an improved net debt/EBITDA ratio of 4.11x (4.49x as end of FY 2022).
Tabreed’s net debt decreased last year due to strong cash generation and a decrease in gross debt due to a proactive debt management exercise. Prudent financial management led the company to achieve reductions in its net finance costs by 24%, despite a high interest rate environment.
Throughout 2023, Tabreed held on to its strong cash flow profile, underpinned by long-term contracts, resilient margins, and efficient working capital management.
Net cash from operating activities stood at Dh 1.31 billion last year (Dh 1.35 billion in the year before), while free cash flows increased by 8% to Dh 1.21 billion, driven by strong operating income, ongoing investment in growth, and streamlining of existing asset portfolio.
The company's Board of Directors, in recognition of its strong financial performance throughout 2023, robust cash generation, and positive outlook, recommended a record high dividend payment of 15.5 fils per share in cash. This represents a 15 %increase from 2022 and reinforces Tabreed’s commitment to maximising value for shareholders.
In 2023, with the enactment of UAE corporate tax law, there was a one-off, non-cash accounting impact due to recognising a deferred tax liability amounting to Dh 359 million, resulting in a reported net profit of Dh 431 million for in 2023.
Tabreed added 53k Refrigeration Tonnes (RT) of new connections last year, across its portfolio locally and internationally. Expansion was mostly driven by organic growth, through new connections in existing concession areas, as well as new ‘greenfield’ plants.
Tabreed continued working on enhancing its presence in its core markets of the UAE and GCC, with the addition of 31k RT in the Emirates, 14k RT in Saudi Arabia, 3k RT in Bahrain, and 1k RT in Oman.
Last year, the company entered the Indian market, through a strategic alliance with TATA Realty and Infrastructure Limited, demonstrating its commitment to diversify and expand beyond the GCC’s geographical borders.
While growing its presence in international markets, Tabreed retained its focus on optimising its existing portfolio to enhance returns. Its total connected capacity increased last year to reach 1.303 million RT.
Among the reasons that made 2023 a great year for Tabreed were the company’s 25th Anniversary, increased public engagement including being the exclusive ‘Cooling Partner’ at the second World Utilities Congress and an exhibitor on Mubadala’s pavilion during COP28 among other activities. As COP28 concluded, Tabreed signed a Dh 600 million Green Revolving Credit Facility under its green financing framework.
2023 being the UAE’s ‘Year of Sustainability’, the company became a signatory to the Responsible Companies Pledge, the Abu Dhabi Sustainable Finance Declaration, and the Global Cooling Pledge.
Prioritising sustainability further, Tabreed developed its Geothermal district cooling plant in partnership with ADNOC in Masdar City, which uses renewable energy to produce chilled water for use.
Notably, two major appointments were made within Tabreed’s Executive Management Team including Nadia Bardawil as Chief Legal Counsel and Philippe Coquelle as Chief Development Officer.
Tabreed’s Chairman, Khaled Abdulla Al Qubaisi, said: “Over the next few years, we will continue to capitalise on Tabreed’s unrivalled history and world-leading experience by aggressively, yet considerately, targeting opportunities for expansion. Opportunities that will provide healthy returns for our investors while benefiting the countries and communities in which we operate."