Tabreed Records Steady Growth in Q1 2024: A Comprehensive Analysis
Summary
Tabreed has reported a 9% YoY increase in consumption volumes and a 4% increase in net profit before tax for Q1 2024. The company's EBITDA margin has also improved, and it has repurchased a significant amount of its outstanding sukuk, indicating active management of its debt profile.Tabreed, the UAE-based utility company and a leading provider of energy-efficient cooling solutions, has demonstrated a steady performance in Q1 2024, with a 9% year-on-year increase in consumption volumes for its cooling services. The company's net profit before tax was reported at AED 122 million, marking a 4% increase from the same period in 2023.
Tabreed's EBITDA margin has also seen a slight improvement, standing at 58% in Q1 2024 compared to 57% in Q1 2023. This indicates a positive trend in the company's operational efficiency. The group revenue for Q1 2024 was AED 468m, reflecting the company's solid market position.
The company's cash conversion rate of 90% and a net debt to EBITDA ratio of 3.97x at the end of Q1 2024 are suggestive of a healthy financial status. Tabreed has also taken proactive steps towards managing its debt profile, having repurchased a total of USD 240 million (AED 880 million) of its outstanding sukuk due in 2025.
Considering these factors, Tabreed appears to be maintaining a steady growth trajectory. However, it is important for potential investors to consider the broader market dynamics and the company's long-term strategy. Given the current financial data and market position, the suggestion would be to hold the instrument, as the company's future prospects appear neutral at this juncture.
