Tuesday 26 / November / 2024
Muscat: OQ Base Industries“OQBI”, (under transformation, has announced its dividends for 2024, targeting a total distribution of OMR 32.7 million. OMR 24.5 million will be distributed in January 2025, with a subsequent distribution of OMR 8.2 million in April 2025.
OQBI's Chief Financial Officer, Ahmed Al Baraami, stated that the company aims to achieve at least 5% annual profit growth in both 2025 and 2026 compared to the previous year, to ensure sustainable growth in returns.
Al Baraami added that, from 2027 onwards, OQBI plans to distribute any excess cash not allocated to core operations, growth investments, or acquisitions.
This dividend policy demonstrates our confidence in maintaining robust cash flows and commitment to aligning shareholder returns with the company's solvency and long-term strategy, he stated."
He added that the expected dividend yield for 2024 is Bsz 9.5 per share, with an anticipated dividend ranging between 8.5% and 8.9%, depending on the share price with an intended increase of at least 5% in 2025 and 2026.
He also noted that at a price range of Bzs 106 to 111 per share, both Category 1 investors (local and foreign institutions) and Category 2 individual investors will receive the same expected yield, between 8.5% and 8.9%.
Al Baraami emphasized, "OQBI's premium returns stem from our stable cash flows and disciplined financial management." He highlighted the company's strong financial track record and well-structured dividend policy, complemented by steady EBITDA margins. "These advantages, combined with our disciplined capital allocation approach, establish us as a reliable and attractive investment destination," he added.
Addressing OQBI's H1 2024 performance, the CFO stated, "In the first half of 2024, our EBITDA reached OMR 39 million, achieving a margin of 37.4%.
He added, "In 2023, the company's EBITDA was OMR 84.6 million with a 43.1% margin, demonstrating our ability to maintain profitability amidst market volatility.
He emphasized the company's exceptional performance in 2022, with adjusted EBITDA reaching OMR 92.7 million and a 43.0% margin, driven by enhanced revenues, especially from liquefied petroleum gas (LPG) sales, and strict cost control measures. The company's 2021 performance showed adjusted EBITDA of OMR 61.3 million with a 39.7% margin, underlining effective cost management and operational efficiency.
Al Baraami added that in 2021, the company achieved total revenues of OMR 154.2 million. This was primarily driven by methanol and ammonia revenues of OMR 126.3 million, while LPG revenues contributed a smaller portion of OMR 27.9 million. He indicated that this year serves as a reference baseline, reflecting the stability of operations.
He reported that OQBI achieved substantial revenue growth in 2022, reaching OMR 215.6 million. This increase was primarily attributed to LPG revenues, which more than doubled to OMR 74.6 million.
The performance was enhanced by favorable market conditions and strong demand, he explained. "Methanol and ammonia operations delivered revenue of OMR 141.0 million, indicating stable growth.
He added, "Our 2023 revenues remained steady at OMR 196.2 million. While methanol and ammonia revenues saw a slight decline, LPG revenues continued their upward trend, reaching OMR 79.8 million, driven by strong sector demand. In the first half of 2024, total revenues reached OMR 104.3 million. Methanol and ammonia contributed OMR 68.3 million, and LPG added OMR 36.0 million. This demonstrated continued stability across both product lines," emphasizing the company's ability to generate consistent revenues across market cycles.
