ADNOC L&S profit jumps 321% as Hormuz disruption lifts tanker rates

The latest:

Net profit at ADNOC Logistics and Services climbed 321% year-on-year to $887 million in the three months to September, lifted by higher oil and gas tanker charter rates and a larger fleet. Revenue more than doubled to $3.29 billion. Profit still slipped 7% from the second quarter’s $951 million on higher operating costs, according to financial statements filed with the Abu Dhabi Securities Exchange.

Details:

• The headline numbers: EBITDA rose 187% to $1.09 billion in the third quarter, according to the exchange filing. Net profit of $887 million was the second straight quarter above $880 million, though below the $951 million recorded in the April-June period.
• Tankers drove it: Oil tanker revenue jumped 358% to $2.05 billion from about $448 million a year earlier, on higher charter rates and the addition of very large crude carriers. Sequentially the unit grew 21%, helped by the acquisition of six additional vessels.
• The rate spike: Disruption to navigation through the Strait of Hormuz pushed Gulf crude freight costs to unprecedented levels. Chartering a VLCC from the Gulf to East Asia cost about $1.4 million a day in early October, roughly 540% above pre-war levels, according to Bloomberg.
• Gas shipping: The gas carrier business benefited from favourable market conditions and increased chartering activity, with operating EBITDA rising to $190 million in the third quarter from about $56 million in the preceding quarter.
• Exports recovering: Combined crude exports from Saudi Arabia, the UAE, Iraq and Kuwait rose to 15.53 million barrels a day in October, close to levels recorded at the start of the year, according to data cited by Bloomberg, after months of costly shipping disruption.
• The upgraded guidance: Management now expects full-year 2026 net profit growth in the low-360% range, against earlier guidance of high-110%. Revenue growth guidance moved to the low-100% range from a mid-20% range, and shipping segment revenue growth to a mid-270% range from about 80%.
• The caveat: The company said annual results remain heavily tied to regional developments, even as shipping performance stayed strong and cargo handling volumes in parts of its logistics operations returned to pre-conflict levels.
• Fleet investment: In October the company announced a $324 million investment to build three very large gas carriers, due for delivery in the second half of 2029 and to operate under seven-year contracts with ADNOC Global Trading. Its fleet already exceeds 900 vessels.
• Shareholder returns: The board approved an interim cash dividend of 313.3 million dirhams ($85.3 million) for the third quarter, with an entitlement date of 23 November. The company targets dividend-per-share growth of at least 5% annually through 2030 alongside continued fleet expansion.
• Market reaction: The stock rose about 1.5% on the Abu Dhabi bourse by 12:08 Dubai time following the results announcement.

Background:

Shipping disruption stemming from the Iranian war forced a rerouting of Gulf energy flows and sharply raised insurance and charter costs for tankers loading in the region, turning freight scarcity into a windfall for owners of crude and gas carriers.

Between the lines:

The quarterly dip exposes the structure of the gain: profit is driven by charter rates set by conflict risk, not volume growth, and exports have already returned close to pre-war levels. Management’s own warning that results remain tied to regional developments, delivered alongside a guidance upgrade to 360%, signals that the 540% freight premium is the variable it cannot control. Fleet additions are the hedge.

What’s next

The dividend entitlement date falls on 23 November. Watch Gulf charter rates for signs the Hormuz premium is unwinding, fourth-quarter results against the upgraded 360% profit guidance, and delivery timelines on the three gas carriers due in 2029.