Abu Dhabi National Energy Company PJSC (TAQA) today announced its financial and operating results for the first nine months of 2016.

“During the period, we delivered strong operational performance and further reduced our capex and costs base consistent with our plan, while maintaining our focus on safety,” said Saeed Al Dhaheri, TAQA’s Acting Chief Operating Officer. “Despite the challenging environment, we maintained a strong liquidity position and increased our free cash flow by 25% compared to the same period last year.”

Financial results

TAQA posted revenues of AED 12.1 billion, 17% lower compared to AED 14.7 billion for the same period in 2015. EBITDA decreased to AED 6.3 billion, 15% down compared to AED 7.4 billion a year ago. As a result, the company recorded a net loss of AED 1.7 billion, compared to a net loss of AED 581 million during the same period in 2015. The decrease in earnings mainly relates to the 31% reduction in realised oil and gas prices and the absence of the one-off AED 555 million UK tax credit booked in the first half of 2015.

TAQA launched a cost transformation programme in 2014 in response to lower commodity prices. The programme has so far generated cash cost savings in excess of AED 2.2 billion. Cash cost savings during the nine month period reached AED 613 million compared to the same period a year ago. Furthermore, TAQA reduced its capital expenditures by 70% to AED 742 million compared to the first nine months of 2015. Free cash flow increased 25% to 5.1 billion dirhams during the period largely as a result of these savings.

TAQA issued USD 1 billion in bonds during the first nine months of 2016. Post-period in October, the company completed an issuance totalling USD 750 million. These bonds help TAQA maintain its strong liquidity position and will reduce corporate financing costs in the long term. As at 30 September 2016, it had cash, cash equivalents and undrawn credit facilities amounting to AED 15.8 billion. Moody’s and Standard & Poor's rate TAQA at A3 and A respectively.

Operations

TAQA’s power assets generated 64,590 gigawatt-hours (GWh) compared to 61,418 GWh in the first nine months of 2015. This 5% increase was driven by strong performance in the United Arab Emirates and Morocco. Water desalination facilities produced 188,166 million imperial gallons (MIG) in line with 2015 production. Technical availability across the global fleet during the period increased to 93.8% from 93.0% a year ago.

TAQA’s oil and gas production decreased by 1.9% to 142.2 thousand barrels of oil equivalent per day (mboe/d), from 144.9 mboe/d, in the same period last year. The decrease is a result of capital expenditure reductions as well as the shut-in of the non-operated Brae Alpha platform during the first quarter. Increased access to third-party pipeline capacity and strong new well performance in North America helped offset the decline. The company reduced per-barrel operating costs by 22% in Europe and 13% in North America compared to first nine months of 2015.

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