ADSB
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Discussion and
Management Analysis
for the period ended 30 June 2023
HIGHLIGHTS
Revenues in the first half of 2023 were AED 566 million, compared with AED 373 million in
the first six months of 2022. The increase in revenues was attributable to recognition of
revenues after work commenced on other major contracts to complement the ongoing
MSS revenues and the Falaj3 contract.
Net profit for the period was AED 21.0 million after incurring costs of AED 2.2 million
relating to the NAVDEX exhibition held in Abu Dhabi in February, compared with AED 5.2
million net profit reported during the corresponding period in 2022. The net profit for the
first half of 2023 was approximately the same as the net profit for the whole of 2022, and
at a time of rising interest rates ADSB was fortunate to have net cash at 30 June 2023 of
AED 284 million which generated interest income during the period of over AED 4 million.
ADSB has now successfully completed four milestones on the Falaj3 program to build four
Offshore Patrol Vessels for the UAE Navy on or ahead of schedule, and five of the nine
blocks of the First of Class vessel have been completed. Work commenced on the second
vessel in the class in the third quarter with the first milestone already achieved.
During the second quarter the Company received the first advance payment on the
contract announced at NAVDEX 2023 to build three BR71 MKII 71 -meter corvettes along
with ADSB-designed patrol boats and logistical support for the Angolan Navy. This contract,
worth just under AED 4.0 billion at current exchange rates, is a very significant deal for ADSB and the largest export order in the Company's history.
Post the end of the second quarter, the Company also received the advance payment on
the contract announced at NAVDEX 2023 to build twenty-four Search and Rescue boats for CICPA. This was an order for the ADSB designed and built vessels which were showcased at NAVDEX 2021. The Company has continued with this strategy and in 2023 showcased a new 17 -meter autonomous Mine Counter Measures vessel which generated significant
Mussafah Industrial Area ascii/all ?Arlan &Wain
P.O. Box 8922 8922:y.03
Abu Dhabi, UAE onion apjall 01)101 ,g4.bg4i
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interest from customers. In addition, contracts were also signed to build and deliver 5x16
meter Sea Troopers and 3x15 meter and 3x18 meter patrol boats.
During the period, the Company continued its activities under both the MSS Military
contract and for Commercial customers, and completed a total of 78 dockings while
completing the mid-life refit of a large military vessel early in the third quarter. The
Company also successfully delivered in the first quarter a refurbished Sea Trooper landing
craft to one of its major customers.
We continue to implement the strategy of expanding the design portfolio both with in
house designs and through working with partners to generate designs in the 50 -meter to
100 -meter range.
The order book now stands at over AED 8 billion and further large potential export sales
are in the early stages of negotiation, with a potential pipeline of an additional several AED
billion. The business will see a very significant increase in activity in the next few years, and a capacity enhancement program with the necessary CAPEX will commence later this year.
The net cash position further improved to AED 284 million as of 30 June 2023 and further
significant sums are expected to be received in the third quarter as both advance payments on new contracts and milestone payments on current ones. Payments are due to suppliers but the cash balance is nonetheless expected to remain healthy throughout 2023,
generating additional interest income.
While the UAE Navy will always be the Company's main customer, and indeed ADSB was
set up to be a strategic national asset for the UAE, ADSB is now demonstrating the results
of its expansion strategy which will enable the Company to pass the benefits back to the
domestic customers in terms of expanded design capability, enhanced production and
maintenance capacity, and economies of scale.
We continue to serve our military and commercial customers and look to the future with
increased conl LJ ce.
David Massey ADS !Z.",
Chief Executive Of rda4-1-614941 \,
Mussafah Industrial Area &aiLminn' Smn all tuilain
P.O. Box 8922 8922 :U.LP
Abu Dhabi, UAE .53a1.12.11 kujal I alflo)11 ,g4hg4i
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Disclosure of Results - Board Meeting
14 August 2023
Date
Name of the Listed Company Abu Dhabi Ship Building PJSC
Date and day of the meeting Monday, 14 August 2023
The meeting was done in person and virtually.
10:00 AM
The Starting time of the Meeting
The End time of the Meeting 11:30 AM
Number of Board members present In person: 2 Members
Virtually: 6 Members
Quorum Achieved (%) 100%
Decisions/Resolutions of the meeting Approval of Company Financial Results for Second
Quarter 2023
The Name of the Authorized Signatory
David Massey
Designation Chief ExecIutive Otfficer ri
Signature and Date
Company's Seal
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ADSB
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Mussafah Industrial Area it Anna eualain
P.O. Box 8922 8922 :u.,p
Abu Dhabi, UAE Mayan tiy)401 01)141 ,u4fig4i
adsb.ae adsb.ae
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Sentiment: positive