Salik rides high on profit wave, shares Dh544.8 million with investors
Dubai's exclusive toll gate operator posted 5.6% higher revenues in H1 2024
Dubai: Salik registered first-half revenue of Dh1.1 billion, up 5.6 per cent year-on-year as Dubai's exclusive toll gate operator recorded 238.5 million revenue-generating trips in the period, up 4.9 per cent year-on-year.
Net Profit before tax grew by 9.2 per cent to Dh598.6 million in the first half of the year, Salik said in a statement, while adding that despite the impact of the new 9 per cent UAE corporate tax, Salik sustained a robust net profit of Dh544.8 million for the first half of the year.
In light of the strong first-half results, the Board of Directors has approved distributing 100% of H1 2024 net profit after tax as dividends to shareholders (Dh544.8 million, equivalent to 7.263 Fils per share), the firm flagged.
Mattar Al Tayer, Chairman of the Board of Directors of Salik, said: “Since the beginning of 2024, we have focused on expanding our core tolling business while diversifying our revenue streams through new strategic initiatives.
"The addition of two new toll gates in Dubai, scheduled to be operational by the end of November 2024, and our recent parking solutions partnership with Emaar Malls, which became operational in July this year, underscore our commitment to diversification and growth.”
Ibrahim Sultan Al Haddad, Chief Executive Officer of Salik, commented: “The increase in revenue-generating trips and active accounts achieved in Q2 2024 reflects our strategic efforts to meet growing demand for efficient transportation.”
During the first half of 2024, revenue from toll usage, comprising 87.1 per cent of total revenue, rose by 4.9 per cent to Dh953.8 million, aiding core earnings (EBITDA) of Dh738.4 million, up 6.5 per cent.
1.6% to Dh462.7 million.
• Fines: revenue from fines increased by 8.4 per cent to Dh57.2 million. The number of net violations (accepted minus dismissed violations) grew 8.5 per cent in Q2 2024, reaching 672,000. Net violations during the second quarter represented 0.6 per cent of net toll traffic, with revenue from fines contributing 10.7 per cent to total revenue.
• Tag activation fees: grew strongly in the second quarter, with revenue increasing 53 per cent to Dh10 million. Tag activation fees contributed 1.9 per cent of total revenues in the quarter.
Record Q2 revenue trips
The total number of trips, including discounted trips, made through Salik’s eight toll gates grew by 1.2 per cent in the second quarter. This is why, revenue-generating trips reached 115.7 million, up 1.6 per cent, the highest second quarter revenue-generating trips since its inception.
Growth remained strong across several gates in the second quarter, the firm noted, with Jebel Ali seeing double digit growth (up 10 per cent), and other gates growing in the high-single digit range, including Al Maktoum Bridge (up 4 per cent) and Al Safa (up 3 per cent).
Growth in active accounts exceeds 14.6 per cent, with registered vehicles increasing by 8.8 per cent to 4.2 million registered active accounts increased 14.6 per cent to 2.5 million from 2.2 million in Q2 2023, with tag activations reaching 244,000 in the second quarter, a 6.3 per cent increase.
In addition, the number of vehicles registered with Salik in the second quarter increased 8.8 per cent, reflecting the "Government of Dubai’s continued success in expanding the economy and ensuring the Emirate remains a key destination for tourism and new residents," it added.
As previously disclosed, Salik said expects to revise its financial guidance and outlook for the 2024 fiscal year, with an update to be provided to the market later this month following completion of assessing the positive financial impact of the two new toll gates, as well as the assumption that the Floating Bridge will remain closed until year-end, the impact of new ancillary revenues and the impact of the 2.5 per cent reduction in the RTA concession fee effective from April 1, 2024.