Continued Growth Drives Toll Usage Revenue To Another All-Time High in Q2
2023; Salik Announces AED 548 million Dividend Distribution for H1 2023
Results
•
Revenue-generating trips exceed pre-pandemic peak levels and reach another new record of c.
113.8 million trips in Q2 2023, supported by a strong macroeconomic backdrop in Dubai
•
Salik once again reports the highest quarterly toll usage revenue in Q2 2023, since start of
operations; toll usage revenue rose c. 13.8% YoY, reaching a record AED 455 million
•
Active registered accounts and vehicles increase c. 5% and c. 8% YoY, respectively, reaching
approximately 2.2 million and 4.0 million at the end of the second quarter
•
Q2 2023 EBITDA and net profit margins of 66.9% and 52.8%, respectively, continue to reflect
Salik’s streamlined business and robust concession framework
•
Salik achieves robust net profit and free cash flow of AED 273 million and AED 357 million,
respectively in Q2 2023
•
In light of the strong set of results, the Board of Directors approved distributing 100% of H1 2023
net profit as dividends to shareholders (c. AED 548 million, equivalent to 7.3057 fils per share)
Dubai, UAE – 11 August 2023: His Excellency Mattar Al Tayer, Chairman of the Board, and the Board
of Directors of Salik Company PJSC (“Salik” or the “Company”), Dubai’s exclusive toll gate operator,
approved by circulation the Company’s condensed interim financial results for the three-month and
six-month periods ended June 30, 2023.
In the second quarter of 2023, Salik broke new records with 113.8 million revenue-generating trips
and toll usage revenues of AED 455 million. Toll usage revenue, which represent 88% of total revenue,
increased 13.8% YoY, another all-time high since Salik commenced operations in 2007, backed by a
robust expansion of tourism and commercial activity in Dubai. Salik reported net profit of AED 273
million during the quarter and the Board of Directors approved a dividend distribution of AED 548
million for Salik’s financial results of the first half of 2023, after receiving authorization by
shareholders during the General Assembly Meeting held in April 2023 for the Board to decide on
dividend distributions covering first half results of each year.
Commenting on the results, His Excellency Mattar Al Tayer, Chairman of the Board of Directors
of Salik, said “The Company’s exceptional results for the second quarter of 2023 are a testament to
our strategic vision and commitment to delivering long-term value to our shareholders. Revenue-
generating trips not only surpassed pre-COVID levels, but they also increased from the previous
quarter, in spite of the typical seasonality effects.”
His Excellency added: “The visionary leadership of Dubai, coupled with the Roads & Transport
Authority’s ambitions of expansion and growth, have created an environment conducive to our
sustained success. As a company deeply rooted in this dynamic landscape, we have harnessed the
immense potential it offers to propel our business forward. By capitalizing on the city's ecosystem
and global connectivity, Salik continues to emerge as a leading toll gate operator globally.”
Ibrahim Sultan Al Haddad, Chief Executive Officer of Salik, commented: "Salik's strong financial
and operational achievements for the second quarter of 2023 continued to build upon ourmomentous award-winning listing on the Dubai Financial Market in September last year. The solid
achievements reflect Dubai's unwavering economic resilience and an unprecedented surge in the
usage of our toll roads. The success validates our robust business model.”
He added: “Salik achieved remarkable profitability during the second quarter of 2023, boasting
impressive revenues of AED 517 million and an EBITDA margin of 66.9%. My team and I remain
committed to deliver exceptional results and unlocking greater value for our shareholders.”
Mobility Highlights
Salik posts 13.8% YoY growth in revenue-generating trips to 113.8 million in Q2 2023, achieving
a new record
The total number of trips, including discounted trips, made through Salik’s eight toll gates in the
second quarter of 2023 witnessed growth of 12.1% YoY, driven by Dubai resuming business-as-
usual commercial and tourist activities, marking the ongoing recovery from the pandemic. As a result,
revenue-generating trips increased 13.8% to 113.8 million trips in the second quarter of 2023
compared to 100.1 million trips in the second quarter of 2022.
Revenue-generating trips exceeded by 6% the pre-pandemic peak level of 107.4 million trips
recorded in the second quarter of 2019, and inched above the previous record level witnessed in the
first quarter of 2023 despite seasonality effects whereby the second quarter typically witnesses
lower level of traffic than the first (5% lower in the case of 2019, Salik’s previous peak year).
In the second quarter of 2023, Al Maktoum bridge saw the number of revenue-generating trips –
excluding paid taxi trips – increase by 52% YoY due to temporary closure of the Floating bridge and
diversion of traffic to Al Maktoum bridge. Excluding Al Maktoum bridge, Salik’s revenue-generating
trips increased 11.6% YoY.
Q2 Q2 % Δ Q1 % Δ H1 H1 % Δ
Million
2023 2022 YoY 2023 QoQ 2023 2022 YoY
Total trips(1) 146.1 130.3 12.1% 146.9 -0.5% 293.0 266.9 9.8%
Discounted trips(2) 30.8 28.5 8.2% 31.7 -2.7% 62.5 58.2 7.3%
% of total trips 21.1% 21.8% -0.8% 21.5% -0.5% 21.3% 21.8% -0.5%
Net toll traffic(3) 115.3 101.9 13.2% 115.2 0.1% 230.6 208.6 10.5%
% of total trips 78.9% 78.2% 0.8% 78.5% 0.5% 78.7% 78.2% 0.5%
Revenue-generating trips(4) 113.8 100.1 13.8% 113.6 0.2% 227.4 205.3 10.7%
% of net toll traffic 98.7% 98.2% 0.5% 98.5% 0.2% 98.6% 98.4% 0.2%
% of total trips 77.9% 76.8% 1..1% 77.3% 0.6% 77.6% 76.9% 0.7%
(1) Total vehicle trips through Salik toll gates
(2) Discounted trips include taxis without passengers, Al Mamzar and Al Maktoum gates free time and discounts, vehicles exempted by law, and multiple violations
and other. Multiple violations refer to drivers that repeatedly drive through the toll gates without paying in 24 hours. In this case, the fine is paid only once
(3) Net toll traffic is total trips minus discounted trips
(4) Revenue-generating trips is net toll traffic minus fines & penalties and unreconciled trips. Revenue-generating trips is the driver for Salik's toll usage fees
revenue, which accounts for the majority of Salik's revenue
Registered vehicles increase 8.2% YoY to c. 4.0 million
The number of vehicles registered with Salik increased 8.2% YoY and 2.0% QoQ to 4.0 million as of
June 30, 2023, reflecting the Emirate of Dubai’s ongoing successful efforts to grow the economy.
Further, registered active accounts increased 5.2% YoY to approximately 2.2 million accounts by
June 30, 2023. Tag activations reached c. 230,000 tags in the second quarter of 2023, a 28%
increase from last year whereas deactivations increased c. 5% YoY to c. 141,000 tags.Financial Highlights
Note on the financial statements:
Comparing Salik's profitability between Q2 2022 and Q2 2023, and similarly, between H1 2022
and H1 2023, may not accurately reflect the company's performance on a like-for-like basis, due
to changes in its operating structure and cost profile. Since July 2022, Salik operates as a
separate legal entity from the RTA through a 49-year concession agreement. As a result, Salik
incurs new costs, such as concession fees, rent, amortization, and transitional service expenses,
as well as finance costs.
Solid growth in toll usage fees drives Salik’s revenue upwards 13.1% YoY to AED 517 million
•
Toll usage fees: Salik continued to break records for a second consecutive quarter, posting its
highest-ever quarterly toll usage revenue during the second quarter of 2023. Continued growth
in commercial and tourist activities in Dubai contributed to a surge in revenue-generating trips.
As a result, toll usage fee revenues increased 13.8% YoY to a record AED 455 million. On a
sequential basis, toll usage fee revenues edged up 0.2% despite seasonality effects whereby
second quarter travel activity is typically softer than the first quarter’s. Toll usage fees
represented 88.1% of the quarter’s total revenues.
•
Fines and penalties: revenues from fines and penalties saw a 5% YoY increase to AED 53 million,
from AED 50 million a year earlier, broadly in line with the increase in the number of violations, net
of violation dismissals (c. 620,000 in Q2 2023 compared to c. 573,000 a year earlier). The number
of net violations remained mostly unchanged as a fraction of net toll traffic, and revenue from
fines and penalties contributed 10.2% to total revenue.
•
Tag activation fees: revenues from tag activation fees increased 37.7% YoY to AED 7 million
and contributed 1.3% of total revenues.
During the first half of 2023, revenue increased 9.7% YoY to over AED 1.0 billion, mainly driven by a
10.7% YoY traffic-driven growth in toll usage fees.
Strong profitability in Q2 2023 underscores strong concession framework
Salik generated an EBITDA of AED 346 million during the second quarter of 2023, broadly flat QoQ,
despite the previously mentioned seasonality effects. In the first half of 2023, EBITDA increased 8.4%
to AED 694 million from AED 640 million in the second half of 2022.
Net profit was broadly flat sequentially, at AED 273 million during the quarter, despite the seasonality
effects. Net profit for the first half of 2023 was AED 548 million, a 3.6% increase over the second half
of 2022.
Salik’s Board of Directors approves dividend distribution of c. AED 548 million for H1 2023
results
In light of Salik’s strong set of results, the Board of Directors approved cash dividends to
shareholders (7.3057 fils per share) for a total distribution of approximately AED 548 million which
represents a full pay-out of the Company’s net profit for the first half of 2023. The Board of Directors
resolution came after receiving authorization by shareholders during the General Assembly Meeting
held in April 2023 for the Board to decide on dividend distributions covering first half results of each
year.Summary of statement of profit or loss
Q2 Q2 % Δ Q1 % Δ H1 H1 % Δ
AED million(1)
2023 2022 YoY 2023 QoQ 2023 2022 YoY
Revenue 517 457 13.1% 520 -0.7% 1,037 945 9.7%
Toll usage fees 455 400 13.8% 454 0.2% 910 821 10.7%
Fines and penalties 53 50 5.0% 55 -4.6% 108 104 3.5%
Tag activation fees 6.5 4.7 37.7% 9 -24.2% 15 16 -6.3%
Other revenue 2 2 38.4% 2 7.8% 4 3 34.7%
EBITDA(2) 346 395 - 348 -0.5% 694 800 -
EBITDA margin 66.9% 86.6% - 66.8% 0.1% 66.9% 84.7% -
Finance costs, net (53) - - (52) 1.3% (105) - -
Profit for the period 273 394 - 275 -1.0% 548 797 -
Earnings per share (AED) 0.036 0.052 - 0.037 -1.0% 0.073 0.106 -
Dividends declared - - - - - 548 - -
Dividends per share (fils) - - - - - 7.3057 - -
(1) Comparing Salik's profitability between Q2 2022 and Q2 2023 and between H1 2022 and H1 2023 may not accurately reflect the company's performance on a
like-for-like basis, due to changes in its operating structure and cost profile since the start of the concession agreement. For further details, please refer to the
notes to the Company’s financial statements.
(2) EBITDA is profit for the period, excluding the impact of finance cost, finance income, and depreciation and amortization expenses
Balance sheet remains solid
In June 2022, Salik secured an AED 4.2 billion credit facility agreement, which includes a revolving
facility of AED 200 million, with Emirates NBD Bank to cover the upfront concession payment and
general corporate purposes. In May 2023, Salik reduced the revolving facility to AED 50 million. At
the end of the quarter, net debt stood at AED 3.1 billion. This translates to a trailing twelve months’
net debt/EBITDA ratio of 2.3x, well below debt covenants.
The Company recorded a favourable net working capital balance of AED -131 million as of 30 June
2023, an increase compared to the first quarter of 2023 (AED -123 million) but broadly stable as a
percentage of revenues.
Summary of financial position
30 June 31 Mar 31 Dec
AED million % Δ QoQ % Δ YtD
2023 2023 2022
Total assets, including: 5,178 5,379 -3.7% 5,303 -2.4%
Cash and cash equivalents 910 1,097 -17.0% 823 10.6%
Total liabilities, including: 4,517 4,500 0.4% 4,699 -3.9%
Borrowings 3,987 3,986 0.0% 3,986 0.0%
Contract liabilities (1) 342 344 -0.7% 338 1.2%
Total equity 660 879 -24.9% 604 9.4%
Net debt 3,077 2,890 6.5% 3,163 -2.7%
Net working capital balance (2) (131) (123) 6.6% (147) -10.8%
(1) Contract liabilities is the sum of current and non-current balances paid in advance by customers relating to recharges and too-ups and tag activation fees
(2) Net working capital is the balance of inventories plus trade and other receivables (unadjusted for impairments) plus dues from related parties minus trade and
other payables, minus due to a related party minus current portion of contract liabilities minus current portion of lease liabilitySolid free cash flow of AED 357 million with a margin of 69.7 % in Q2 2023
In the second quarter of 2023, Salik generated free cash flow of AED 357 million thanks to continued
strong traffic performance. Salik did not incur any capital expenditures during the second quarter of
2023. Free cash flow margin reached 69.1% from 62.5% in the previous quarter.
Summary of cash flow
Q2 Q2 % Δ Q1 % Δ H1 H1 % Δ
AED million
2023 2022 YoY 2023 QoQ 2023 2022 YoY
Operating cash flow before
354 398 - 355 -0.4% 709 813 -
changes in working capital
Changes in working capital 4 19 - (30) - (26) 15 -
Net cash flow from operating
357 417 - 325 9.9% 682 828 -
activities
Net cash generated from / (used)
7 (3) - 4 - 11 (3) -
in investing activities
Net cash (used in) / generated
(550) 3,791 - (55) 898.4% (605) 3,380 -
from financing activities
Free cash flow(1) 357 414 - 325 9.9% 682 825 -
Free cash flow margin(2) 69.1% 90.5% - 62.5% 6.6% 65.8% 87.3% -
(1) Free cash flow is net cash flows from operating activities less purchases of property and equipment plus proceeds from the sale of property and equipment
(2) Free cash flow margin is free cash flow divided by revenue
Business Highlights
Salik wins ‘Best IPO in the Middle East’ at EMEA Finance’s Achievement Awards 2022
In the second quarter of 2023, Salik won the prestigious title of Best Initial Public Offering in the
Middle East 2022 by EMEA Finance Magazine. This recognition comes after the Company’s
successful listing on the Dubai Financial Market. The award was presented at a special ceremony
held in London where prominent representatives from leading companies and financial institutions
across the Middle East, Europe, and Africa were in attendance. Salik’s achievement in securing this
accolade underscores its significant contribution to the financial sector in the region and highlights
its exceptional performance in the Initial Public Offering.
Salik is making further progress in its efforts to promote sustainability
Salik remained committed to environmental sustainability by encouraging the use of electric vehicles
and providing free Salik tags to their owners. As of June 30, 2023, the number of registered vehicles
with these tags doubled from a year earlier, and increased by 11.3% compared to the previous
quarter, reaching 3,194 vehicles.
Salik continues to prioritize investing in its human resources and upholds its commitment to diversity
and inclusivity. Salik expanded its full-time workforce from 12 on June 30, 2022 to 37 personnel as
on June 30, 2023, and saw a rise in the number of nationalities represented from 6 to 12.
Furthermore, Salik continued to emphasize gender diversity, with females comprising 24% of the
total workforce as of June 30, 2023. The company also achieved advancements in Emiratization,
attaining a level of approximately 38% by the end of the quarter.
Salik continued to offer tariff exemptions to vehicles used by charities, schools, people of
determination, ambulances, and other public services. The number of free-of-charge trips made by
exempted vehicles through Salik’s eight toll gates increased 9.8% YoY to c. 2 million during the
second quarter of 2023, at a rate of over 22,000 trips per day, on average. The increase was drivenby an increase in the number of registered exempted vehicles by 12.8% YoY to reach over 50,000
vehicles by the end of the quarter.
Business Outlook
In the second quarter of 2023, Salik continued to experience a consistent and positive increase in
the number of trips made through its eight toll gates. In light of this performance, the company
revises its guidance for the entire year. Salik expects revenue-generating trips to grow 9-10%
compared to 2022, with an EBITDA margin in the range of 66-67%.
—ENDS —
About Salik Company PJSC
The Company was established in its current form, as a public joint stock company in June 2022
pursuant to Law No. (12) of 2022. “Salik”, which means “seamless mobility” in Arabic, is Dubai’s
exclusive toll gate operator and manages the Emirate of Dubai’s automatic toll gates utilising Radio-
Frequency-Identification (RFID) and Automatic-Number-Plate-Recognition (ANPR) technologies. The
Company currently operates 8 toll gates located at strategic junctures, especially on Sheikh Zayed
Road, which is considered the main road in Dubai. In 2022, 539 million journeys were recorded
through Salik’s toll gates, whether for residents commuting within the Emirate for their daily activities
or for tourists visiting Dubai’s attractions. Under a 49-year concession agreement (ending in 2071),
with the Roads and Transport Authority (RTA), Salik has the exclusive right to operate existing and
any future toll gates in Dubai.
Investor Relations Media Enquiries
Mohamed Zein Faisal Tawakul
Head of Investor Relations Marketing & Corporate Communications
E: Mohamed.Zeinelabedin@salik.ae Manager
E: Faisal.Tawakul@salik.ae
Disclaimer
No statement in this document is intended to be nor may be construed as a profit forecast. Any statements
made in this document which could be classed a “forward-looking” are based upon various assumptions,
including, management’s examination of historical operating trends, data contained in the Company’s records
and other data available from third parties. Although the Company believes that these assumptions were
reasonable when made, these assumptions are inherently subject to significant risks, uncertainties and
contingencies. Forward-looking statements are not guarantees of future performance. Risks, uncertainties,
contingencies could cause the actual results of operations, financial condition and liquidity of the Company to
differ materially from those results expressed or implied in the document by such forward-looking statements.
No representation or warranty is made that any of these forward-looking statements or forecasts will come to
pass or that any forecast result will be achieved. No reliance should be placed on any forward-looking statement.

Sentiment: neutral