2019 gross debt at Abu Dhabi's TAQA drops by $732.4m to $17.2bn

The reduction in debt has resulted in a decrease of cash interest paid in 2019 that dropped by $33.2m compared to 2018 figures

Abu Dhabi National Energy Company (TAQA) is listed on ADX.
Abu Dhabi National Energy Company (TAQA) is listed on ADX.

ADX-listed Abu Dhabi National Energy Company (TAQA) has reported a reduction in 2019 gross debt that dropped by $732.4 (AED2.9bn) year-on-years to reach $17.2bn (AED63.3bn), compared to $18.1bn (AED66.3bn) in 2018.

In a stock exchange missive the company said that the reduction in debt has resulted in a decrease of cash interest paid in 2019, which dropped by $33.2m (AED122m), compared to the same period in 2018.

The company added that despite the reduction in debt, leverage ratios remained unaffected due to the weaker earnings before interest, taxes, depreciation, and amortisation (EBITDA) levels. The net debt-to-EBITDA multiple witnessed a slight increase from 6.5 times in 2018 to 6.6 in 2019.

Meanwhile, profit attributable to TAQA shareholders dropped by 70.2% from $108.4m (AED398m) to $63.7m (AED234m) in 2019, indicating a decrease of $44.7m (AED164m) Y-o-Y. The profit attributable to shareholders glided on the back of “weaker revenues on lower commodity prices, but more so on increased repair and maintenance spend within the group’s international power assets and lower income from associates”.

The company explained that the “effects were only partially offset by reduced finance costs due to the continue reduction in gross debt and a lower tax expense driven by lower taxable profits mainly within the oil and gas business”.

Despite higher capital expenditure, which spiked from $462.8m (AED1.7bn) in 2018 to $490.1m (AED1.8bn) in 2019, the free cash-flow generation remained strong at $1.6bn (AED6.8bn).

The firm’s capex was completely self-funded by cash generated from its operations and was focused on sustaining and developing its power and water as well as oil and gas assets.

Additionally, the group’s 2019 revenues witnessed a slight deduction to $4.79bn (AED17.7bn) from $4.82bn (AED17.7bn) in 2018.

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