Adnoc Gas profit down on weaker export prices

• Net profit of $1.17bn in fourth quarter
• In line with analysts’ predictions
• Ebitda also declines despite sales

Abu Dhabi’s Adnoc Gas reported a 15 percent drop in fourth-quarter net profit as higher domestic gas sales failed to fully offset declines in the prices of its export products.

The company, a subsidiary of Abu Dhabi National Oil Company, processes natural gas. Its business is split roughly evenly between UAE gas sales and exports of liquids such as propane, butane, naphtha and liquefied petroleum gas.

“Adnoc Gas is almost unique globally in terms of being a midstream gas processing company that sells domestically but also exports,” said Oliver Connor, director of energy equity research at Citi in London.

Adnoc Gas made a net profit of $1.17 billion in the three months to December 31, from $1.38 billion in the prior-year period when the company made a one-off gain from a contract negotiation.

Citi, EFG Hermes and FAB Securities each forecast Adnoc Gas would make a fourth-quarter net profit of $1.1 billion.

A quarterly profit drop would be “cyclical and nothing out of the ordinary”, Ahmed Hazem Maher, an equity research director at EFG Hermes in Cairo, told AGBI ahead of Adnoc Gas’s earnings.

The company’s share price ended flat on Monday trade, while Abu Dhabi’s index closed up 0.4 higher.

Prices of its liquid products track oil prices, which were 15 percent lower in the fourth quarter than the same period the year before.

Its quarterly exports’ earnings before interest, tax, depreciation and amortisation (Ebitda) fell to $928 million from $978 million a year earlier – a decline of 5 percent – despite sales volumes rising 11 percent.

More positively, fourth-quarter domestic gas sales rose 5 percent by volume.

“The company is extremely resilient to lower oil prices and that is driven to a large extent by the strength of the domestic market,” Peter van Driel, Adnoc Gas chief financial officer, told a news conference on Monday.

“The domestic market is performing really well. It’s not just about having more sales volumes but also improving [our] margins.”

Adnoc Gas’s UAE gas sales have expanded in line with the country’s annual GDP growth over the past two years, said Van Driel, predicting the energy demands of the power sector and heavy industry would drive domestic profit growth this year.

As the price of oil-price-linked export products has fallen, the UAE gas business has provided an increasing share of annual net profit, rising to 54 percent in 2025 from 51 percent last year and 49 percent in 2023, according to AGBI calculations.

Adnoc Gas forecasts its sales volumes will total 3,705 to 3,825 trillion British thermal units (TBTU) this year, up slightly on last year’s 3,702.

EFG Hermes forecasts Adnoc Gas’s 2026 full-year net profit will be near-flat versus its 2025 record annual net profit of $5.17 billion, which was up 3 percent versus 2024.

Adnoc Gas said in a statement that its 2025 net profit increase “was primarily driven by the strength of its domestic gas business”, pointing out that the unit’s Ebitda rose 10 percent year on year as sales volumes grew 4 percent over the same period.

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Adnoc Gas’s capital expenditure will be $4 billion to $4.5 billion this year, the statement said.

Van Driel said the company would grow by expanding its business internally rather than making acquisitions.

“It’s very difficult to find projects [abroad] that have a better return than what we have today in our portfolio, [also] it’s likely your risk profile will also be less attractive,” he added.