AD Ports Group disclosed an impressive 189% year-on-year increase in third-quarter revenue, reaching Dh4.24 billion in 2023. 

Strategic mergers and acquisitions, including Noatum’s Logistics, Maritime, and Ports businesses, drove the growth.

Like-for-Like Basis Performance:

On a like-for-like (LFL) basis, excluding the effects of M&A activities, the revenue still showcased a substantial 113% year-on-year growth. 

Key contributors to this growth were the logistics, maritime & shipping, ports, and EC&FZ clusters, posting performances of 546%, 264%, 71%, and 20%, respectively.

AD Ports Group’s Q3 2023 EBITDA surged by 28%, reaching Dh759 million, largely influenced by the acquisition of Noatum and Karachi Gateway Terminal. 

However, higher contributions from maritime & shipping and logistics led to an EBITDA margin dilution to 17.9% for the quarter, compared to 40.5% in Q3 2022.

Future Outlook and Margin Guidance:

Despite the margin dip, the group maintains an EBITDA margin guidance of 25-30% in the medium term. This expectation is grounded in anticipating a continued rebalancing of the revenue mix as the group invests organically and inorganically.

The maritime & shipping cluster emerged as the top revenue and EBITDA contributor, accounting for 56% and 33% in Q3 2023. Noatum Maritime’s contribution and strategic vessel trading activities significantly influenced this dominance.

Profitability and Cash Flow Performance:

The total net profit experienced a notable 20% year-on-year surge, aligning with EBITDA performance. 

However, negative net operating cash flows of Dh579 million were attributed to temporary working capital challenges related to vessel trading activities. The group expects a recovery in Q4 2023 when associated cash collections occur.

Capital Expenditures (CapEx) in Q3 2023 reached Dh800 million, aligning with the front-loaded Dh15 billion capex program between 2023 and 2027. 

The Net Debt to EBITDA ratio stood at 4.0x, with expectations for normalization in the last quarter of the year.

Leadership Perspectives:

Captain Mohamed Juma Al Shamisi, Managing Director and Group CEO of AD Ports Group, expressed satisfaction with the growth trajectory, emphasizing strategic M&A activities and collaborations beyond traditional operations. 

Martin Aarup, Group Chief Financial Officer, highlighted the strength of the diversified business model and anticipated positive results from ongoing investments and operational scaling.