ADNOC Drilling investors set for $262.5 million payout after record quarter

Dubai: ADNOC Drilling shareholders are set to receive a second-quarter dividend of $262.5 million, equivalent to approximately 6 fils per share, after the company reported record revenue and profit for the first half of 2026.

The payment is expected during the second half of August for shareholders registered by August 10. It takes total dividends declared for the first six months of 2026 to $525 million, representing half of the company’s $1.05 billion annual dividend floor.

The dividend floor is scheduled to increase by a minimum of 5% annually through at least 2030.

Revenue increased 4% year on year to $2.46 billion during the first half, supported by higher activity across the company’s drilling and oilfield services operations.

Net profit rose 2% to $706 million, while earnings before interest, tax, depreciation and amortisation increased 1% to $1.08 billion. The net profit margin remained at 29%, with return on equity maintained at 34%.

Second-quarter revenue increased 3% to $1.23 billion, while quarterly net profit rose 2% to $359 million. ADNOC Drilling said operations continued without interruption during the period, supported by high fleet availability and a largely contracted revenue base.

“Growth in OFS is accelerating, while technology and AI are enhancing efficiency, performance and value creation across our operations,” ADNOC Drilling CEO Abdulla Ateya Al Messabi said.

“These record results reflect the strength of our business model and the disciplined execution by our people. With operations remaining resilient and uninterrupted throughout the period, we are pleased to reaffirm our full-year 2026 guidance with confidence.”

Oilfield Services remained the company’s main growth engine, with revenue increasing 5% to $726 million during the first half.

Growth came from higher Integrated Drilling Services activity, an expansion of standalone services and the timing of directional drilling and drilling fluids work. ADNOC Drilling also expanded its slickline fleet and secured a 50% share of ADNOC’s Vertical Rigless tender.

Onshore revenue increased 2% to $1.03 billion, supported by UAE operations and contributions from MBPS and SLDC, which operate 30 land rigs primarily in Oman and Kuwait.

Offshore revenue rose 5% to $703 million, reflecting the deployment of new jack-up rigs during the second half of 2025 and the conversion of rigs from onshore to offshore operations.

Unconventional operations drilled more than 100 wells during the period while achieving targeted cost efficiencies, according to the company.

ADNOC Drilling deployed AD-300, its first AI-enabled automated island rig, ahead of schedule in June.

The rig is expected to begin contributing to revenue during the second half of 2026. The company said greater automation would improve utilisation and reduce well delivery times and unit costs.

Five additional island rigs are planned to support future offshore activity, while ADNOC Drilling is targeting the deployment of approximately 70 Integrated Drilling Services rigs by the end of 2026.

Following the end of the quarter, a repurposed land rig also began operations in Oman through the MBPS platform, marking the company’s first organic rig deployment in the country.

ADNOC Drilling maintained its 2026 revenue guidance at approximately $5 billion, including about $2 billion from onshore operations and $1.5 billion each from offshore drilling and oilfield services.

Full-year EBITDA is forecast at between $2.2 billion and $2.3 billion, with net profit expected to reach between $1.45 billion and $1.50 billion.

The company continues to expect free cash flow of between $1.2 billion and $1.3 billion, excluding acquisitions, while capital expenditure is projected at between $600 million and $800 million.

Net debt is expected to remain below two times EBITDA, with the company retaining its annual dividend floor of $1.05 billion for 2026.