Oil & Gas

In a recent conversation, Youssef Salem, Chief Financial Officer of ADNOC Drilling, outlined the company’s strategic trajectory, financial resilience, and transformation into a technology-enabled energy services provider. ADNOC Drilling has distinguished itself through long-term contracts that secure nearly 80% of its revenues, shielding it from oil price volatility. Salem emphasized the strength of their contract-backed model and their evolution beyond traditional drilling, with a fleet of 142 rigs and a leading 74% penetration in Integrated Drilling Services (IDS), expanding further into Oilfield Services (OFS) and unconventional platforms.

Since its IPO in 2021, ADNOC Drilling has delivered double-digit annual revenue growth, with a 30% CAGR, reporting a 32% revenue rise in Q1 2025. The company maintains industry-leading margins, with a 51% EBITDA margin and strong returns on capital. A progressive dividend policy extended through 2029 ensures at least $5.3 billion in payouts, offering a cumulative 18% yield. With a low 1.0x net debt/EBITDA ratio, ADNOC Drilling balances growth investments with shareholder returns, appealing to investors seeking yield and stability.

ADNOC Drilling is actively engaging global investors through roadshows, conferences, and transparent communication, supported by its inclusion in MSCI and FTSE Emerging Markets indices. A 50% increase in free float and the introduction of a five-year dividend growth plan have enhanced the company’s visibility. With 19 analysts covering the stock, almost all rating it a “Buy,” ADNOC Drilling stands as the most covered stock in the GCC, aiming to be a cornerstone for investors pursuing stable energy exposure amid volatile markets.

Furthermore, ADNOC Drilling is embedding ESG principles across its operations, leveraging hybrid rigs, solar energy, and AI-driven technologies to reduce emissions. Through platforms like Enersol and Turnwell, the company is pioneering efficiency and sustainability in well delivery. Salem addressed misconceptions about the company’s exposure to oil price fluctuations and limited service scope, emphasizing its integrated model and technological edge. Positioned at the heart of the GCC’s energy evolution, ADNOC Drilling offers a compelling investment case: strong fundamentals, predictable returns, and a leading role in shaping the energy transition in emerging markets.