ADNOC L&S lifts 2026 guidance after profit rises to $222 million

Dubai: ADNOC Logistics and Services raised its 2026 earnings guidance after first-quarter profit climbed 20%, with higher shipping rates and a wider global operating base helping the Abu Dhabi company absorb disruption to maritime traffic through the Strait of Hormuz.

The company reported net profit of $222 million, equivalent to Dh816 million, for the first three months of 2026. EBITDA rose 7% from a year earlier to $368 million (Dh1.35 billion), while the EBITDA margin widened by 5 percentage points to 34%.

Revenue fell 10% to $1.08 billion (Dh3.96 billion), mainly because of the scheduled run-off of project revenues after the Al Omairah Island mega project was delivered to ADNOC Offshore in the fourth quarter of 2025. The fall in revenue was offset by stronger margins, higher shipping rates and gains across parts of the fleet.

“ADNOC Logistics & Services delivered first-quarter results growth in a challenging market environment," said Captain Abdulkareem Al Masabi, CEO of ADNOC L&S. "Despite disruption to maritime traffic through the Strait of Hormuz, our diversified business model continued to perform as expected. Our global scale, long-term contracted revenue base and integrated portfolio underpinned our resilience.”

Long-term contracted revenue remains a key support for the business. ADNOC L&S said contracted revenue represents about 60% of the combined revenue of ADNOC L&S and its AW Shipping joint venture, giving the company better visibility on earnings and cash flow.

The shipping segment was the strongest performer in the quarter. Revenue rose 4% to $512 million (Dh1.88 billion), while EBITDA increased 37% to $197 million (Dh723.5 million).

The gains were driven by higher global charter rates and contributions from new LNG, VLEC and Handysize vessels. Stronger fleet performance also lifted the segment’s EBITDA margin to 38%, compared with 29% in the same period last year.

Net profit in the segment included a $6 million (22.03 million) contribution from the AW Shipping joint venture and a $27 million (Dh99.16 million) capital gain from the sale of the VLCC Leicester. These gains were partly offset by the absence of one-off gains recorded in the previous year, including a contract termination benefit and the sale of the medium gas carrier Yas.

Integrated Logistics saw revenue fall 23% to $481 million (Dh1.76 billion), while EBITDA dropped 17% to $151 million (Dh554.5 million). The company said the decline mainly reflected the scheduled run-off of revenues after the delivery of Al Omairah Island.

Lower utilisation and reduced day rates across the Jack-Up Barge fleet also weighed on performance, with regional geopolitical developments affecting activity levels. Additional revenue from three new JUB and offshore support vessel assets helped partly offset the decline.

The Services segment delivered steadier growth, with revenue up 5% to $89 million (Dh326.85 million) and EBITDA rising 13% to $20 million (Dh73.45 million). The segment benefited from the contribution of an Integrated Logistics Service Platform warehouse, which was moved from Integrated Logistics to Services, along with income from Integr8, the bunkering business of Navig8.

ADNOC L&S is continuing its fleet expansion programme, with the Arada LNG carrier joining the fleet in March, followed by Al Taweelah in April. Both vessels are part of a $1.2 billion (Dh4.40 billion) order placed in 2022 with Jiangnan Shipyard in China.

Five new-build LNG carriers are being deployed under long-term contracts from May 2026 to transport LNG produced by ADNOC Gas. The company said the vessels are designed to reduce methane emissions by up to 50% compared with older-generation vessels, while improving efficiency and cost performance.

The company also signed an agreement with Emirates Global Aluminium to explore cooperation on supply chain resilience in the aluminium value chain. The agreement could lead to deeper cooperation on logistics assets, transportation services, fleet management and integrated supply chain solutions.

ADNOC L&S said it has raised its 2026 guidance for revenue, EBITDA and net income after factoring in actual performance through the first quarter and April.

The company remains cautious on offshore contracting because of regional uncertainty, but said shipping demand and supply fundamentals remain supportive. Guidance assumptions for shipping have been updated from May onward, while still taking a conservative view compared with current market rates.

ADNOC L&S also confirmed its medium-term outlook and 2027 to 2029 CAGR guidance. Capital expenditure guidance remains unchanged, and the company said it retains significant financial capacity for investments beyond announced projects.

The dividend for FY2026 is expected to reach $341 million, equivalent to Dh1.25 billion, reflecting a planned 5% annual increase from 2026 until 2030. The dividend is expected to be paid quarterly, subject to approvals.