National Central Cooling Company (TABREED) Q2 2024 earnings summary

Executive summary

• Achieved solid business growth and improved financial position in H1 2024, with a focus on sustainability and operational efficiency.

• Revenue for the six months ended 30 June 2024 was AED 1,079.6 million, up slightly from AED 1,067.5 million year-over-year, with EBITDA margin improving to 56% from 55% year-over-year.

• Normalized profit before tax rose 4% year-over-year, and normalized return on equity increased to 9.7% from 9.0%.

• Significant progress in sustainability, including a 10% reduction in energy intensity, 35% reduction in carbon emission intensity in 2023, and 1.0 billion kWh energy reduction with 604,000 tons of CO2 avoided in H1 2024.

• Announced new Chairman and board member appointments to support future growth.

Financial highlights

• Group revenue reached AED 1.1 billion, up 1% year-over-year; normalized revenue growth was 6% after adjusting for one-off items.

• EBITDA of AED 603 million with a 56% margin; normalized profit before tax up 4% to AED 307 million.

• Net profit attributable to equity holders for the period was AED 269.0 million, down from AED 386.4 million year-over-year.

• Free cash flow of AED 404 million generated in H1 2024.

• Cash balance at period end was AED 577.8 million, with an undrawn AED 600 million revolving credit facility.

Outlook and guidance

• Updated capacity guidance to 100,000 RT for 2023-2024, with 85% expected from consolidated entities.

• Targeting 3%-5% annual growth in connected capacity over the next three years.

• Some project delays in Saudi Arabia, with King Salman Park phase one now expected in H1 2025.

• Results for the six months are not necessarily indicative of full-year performance due to seasonality in chilled water demand.

• Strong pipeline of projects and M&A opportunities in UAE, Saudi Arabia, India, and Asia.