Abu Dhabi National Energy Company PJSC (“TAQA”), a publicly listed company on the Abu Dhabi Securities Exchange (ADX: TAQA), today reported its First Quarter 2011 operational and financial results.

Summary
Improved commodity prices, higher oil and gas production and increased power and water revenues due to the commissioning of Fujairah 2 resulted in a solid financial performance for TAQA during the first quarter of 2011. Overall TAQA’s total revenues increased 15% year-on-year while tight cost control resulted in a 27% increase in EBITDA to reach AED 3.3 billion.

TAQA’s Profit Before Tax was 11% higher year-on-year, dampened by the effect of foreign exchange losses along with lower derivative gains. Net Profit After Minority Interests was AED 152 million, versus AED 287 million in Q1 2010, due to an increase in taxes for operations in the UK North Sea.

TAQA has continued to progress its major organic growth projects with two key developments. Firstly, at the end of the quarter TAQA signed the contract for the construction of two additional power production units at its 700 MW facility in Morocco, a major milestone in taking the project into construction.

Secondly, TAQA continued to progress the Bergermeer Gas Storage project. There is broad support in the Dutch parliament and all required statutory approvals and permits to construct and operate the Bergermeer Gas Storage facility in the Netherlands are expected to be received this month.

Comment
H.E. Abdulla Saif Al-Nuaimi, Chief Executive Officer and Managing Director of TAQA, said:
“TAQA has made a solid operational start to 2011, with strong performance from our Power & Water business and a higher contribution from our Oil & Gas assets due to a combination of improved commodity pricing and increased production. These positive results also reflect our increased footprint, where new assets – such as Fujairah 2 – are beginning to contribute additional revenues. We continue to be focussed on operational excellence and efficiency right across our business to ensure we deliver the maximum value possible.”

Carl Sheldon, General Manager of TAQA, said:
“We remain fully committed to our focussed strategy that will enable us to continue building TAQA into a global energy company. As evidence of this, our major organic growth projects in the Netherlands and Morocco have reached significant milestones, while those in Ghana and India have made good progress. In particular, the expected receipt of permits in the Netherlands for operating and constructing Bergermeer in May has enabled us to this week launch the open season for longer-term capacity and start planning the next stage in this flagship project’s development.”

Financial Summary
Total revenues for Q1 2011 were AED 5.5 billion, 15% higher year-on-year, compared with total revenues of AED 4.8 billion in Q1 2010.

Total Oil & Gas revenues (including gas storage and other income) increased from AED 2.6 billion to AED 3.0 billion for Q1 2011. This 14% increase was primarily driven by the increase in crude oil prices, partially offset by lower North American natural gas prices.

Total Power & Water revenues, excluding supplemental fuel income, increased from AED 1.5 billion in Q1 2010 to AED 1.7 billion in Q1 2011. This 13% increase was primarily driven by the first quarter’s contribution from Fujairah 2, which was transferred to TAQA in the third quarter of 2010 and fully commissioned in January 2011. Supplemental fuel income increased 23% year-on-year due to higher use of additional fuel supplies at TAQA’s domestic power plants.

Cost of sales increased 8% from AED 3.2 billion to AED 3.5 billion. Within this, operational expenses, excluding fuel and gas storage expenses, reduced 3%. Depreciation, depletion and amortisation increased 16% reflecting TAQA’s increased asset base.

Profit before Tax was 11% higher year-on-year, dampened by a loss on foreign exchange plus lower gains on derivatives.

In mid-March the UK government announced changes to the tax regime for the UK North Sea which were backdated to 01 January 2011. This contributed to a 53% year-on-year increase in tax, negatively impacting Net Profit After Minority Interests which totalled AED 152 million, versus AED 287 million for the same period in 2010.
Total debt and net debt increased year-on-year due to the transfer of interests at Fujairah 2 and Shuweihat 2. However, TAQA’s Net Debt/Capital ratio decreased to 79%. Net Debt/EBITDA reduced to 5.4 times for Q1 2011, versus 7.1 times at the end of Q1 2010.
 

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