Dubai’s Salik Sees Q4 Profit Growth Amid Rising Toll Gate Revenue

Dubai’s toll operator, Salik, has announced a 3% annual increase in fourth-quarter profit, driven by higher revenue from toll gates. According to a regulatory filing to the Dubai Financial Market, Salik’s net profit for the period reached Dh295 million ($80.3 million), supported by a 12.2% rise in revenue to Dh563 million.

Salik CEO, Ibrahim Al Haddad, expressed satisfaction with the company’s performance, highlighting their commitment to strengthening the core business while pursuing sustainable growth. He emphasized the company’s strategy to explore additional revenue sources beyond tolling, such as providing technology solutions for parking, as demonstrated by their collaboration with Emaar Malls to develop a parking management system at Dubai Mall.

Salik aims to expand its service portfolio, offering vehicle-centered mobility solutions directly through Salik accounts. Revenue-generating trips during the fourth quarter saw an 11.1% year-over-year increase to 123.2 million, contributing significantly to the company’s overall revenue.

For the full-year 2023, Salik reported a profit of approximately Dh1.1 billion, with revenue reaching Dh2.11 billion, driven by a robust macroeconomic environment and positive tourism trends. The company expects a 4-6% year-on-year increase in revenue-generating trips for 2024, maintaining a strong EBITDA margin of 65% to 66%.

Chairman of Salik, Mattar Al Tayer, attributed the company’s success to its strategic vision and the favorable economic conditions in the UAE, with Dubai’s GDP growth and tourism sector expansion contributing significantly.

Dubai’s economy witnessed a 3.3% annual expansion in the first nine months of the previous year, driven by growth in tourism and transport sectors. Emirates NBD forecasts a 4% GDP growth for Dubai in the current year.

Salik’s IPO in September 2022, aimed at expanding the financial market, raised Dh3.73 billion, with overwhelming demand from investors. The offering, oversubscribed by more than 49 times, reflects investor confidence in Salik’s growth prospects and the Dubai government’s commitment to market expansion.