Oman Oil Marketing Company SAOG (OOMS) Earnings Call Transcript & Summary

Good morning, everyone. I'd like to apologize for the delay. We had some technical issues [Foreign Language] got resolved. We will like to start with the presentation in terms of giving an update of our structure, what has happened in the last 6 months and just an update on the financials. Well, in terms of the overview of the company. So this is our current structure. As you can see, Oman Oil is in the middle. We have 49% with our biggest stakeholders OQ. And underneath this, we have several subsidiaries, investments. We have Muscat Gases on the right side, we own about 9.18%. And then other subsidiaries include Ahlain International, and mainly this is focusing on our convenience stores and our Café Amazon and the digital aspects. We have OOMCO Marine, where we look at the marine sector, providing bunker to various ships surrounding in Oman and surrounding Oman. We have Sultanate Energy Company, which is our Tanzanian subsidiary, where we invest in Tanzania through it. And we have Oman Oil Marketing, which is in KSA. Again, it's a 100% subsidiary of Oman Oil, and we invest in Saudi Arabia. And 2 more other subsidiaries, we have EVO, which focuses on electric vehicle and alternative energy. And the last one is TFG, where it's a joint venture between us and a renowned company, TFG, which is worldwide. Our main operations are as follows: retail fuels is our biggest sector. And then we have that's mainly the stations. Then we have our commercial fuels where we offer fuels to our various customers, mainly commercial. Aviation fuel, we are 100% in terms of providing aviation fuels to Salam Air and 50% to Oman Air. Then we are also into the lubricants, whether it's using our brand called Optimol or providing lubricants such as Caltex, BP Caltex. Nonfuel business, this is what I mentioned, Ahlain, where we have convenience stores and coffee offerings. Storage and distribution mainly is our warehouse in [ Sohar ], where we have our lubes where we store them and distribute it from there. Duqm Bunker Terminal is, as I mentioned, for our bunkering activities as well as marine fuels. And then alternative energy and digital are also other kind of aspects that we try to provide. Next slide, please. So total stations, we have 287, of which 239 are in Oman. In KSA, we have 36 stations. And in Tanzania, we have 12 stations over there. In terms of our national fuel, we are very happy to at least talk about this particular year. We have achieved 7% higher growth than what we have done last year, the same specific period. And this is mainly attributed to the great marketing skills and our operations. Expansion. We have expanded into 3 particular stations, one in Muscat, one in North Batinah and the other one in Sohar this year. In terms of KSA, we have added 3 new stations. We have also closed 4 stations. And these 4 stations, one of them was an old station that was not necessarily doing as what we wanted it to. So we made sure that instead of continuing on, we closed that. And another 3 were what we call franchise options, which was a kind of model, which we wanted to see if that would work. In terms of the sales performance, we have done pretty well, even closing 4 stations and opening 3, we've managed to increase our year on turnover by 33%. In terms of Sultanate Energy, which is mainly the Tanzania, our turnover has decreased because we have been experiencing currency fluctuation, and we didn't want to increase our imports over there. So we have just focused mainly in terms of the distribution of fuel in Tanzania for this specific period. Next slide. So our other investments, Ahlain International, our Ahlain, we've been doing very well. We have 59 stores locations of our convenience stores here. What this does is actually enhances our fuel station, our retail station. That's why you can see a huge contribution of 7% to our retail. Of course, a lot of efforts have been done, but also Ahlain contributes to that. Café Amazon, we have about 16 outlets in Oman. We opened 2 this year, and we continue to do so as we see fit and depending on market acceptability. And digital is where we have about 59 digital units all around the country, where we try to use it in terms of marketing our products as well as third-party products. Our TFG OOMCO, which we call [indiscernible] in the Marine, although this -- we have finally -- we really -- we are operating the joint venture as of 15th of June. But I thought this is a good -- it's a very good moment for us because we are here trying to get along with a very big renowned bunker company in the world. And hopefully, this will be a big game changer for Oman Oil, especially in the bunkering sector. Our alternative energy, so through our subsidiary electric vehicle charging, which is EVO. We've been very active. We've signed an agreement with Talabat to support their eco-friendly deliveries by providing them e-bikes and also charging points in-house in certain stations where they can swap their batteries over there. And other achievements is we received the Platinum Award of Green Mobility during Sustainability Week during this year, which is a high achievement in that standard. And during the Sustainability Week, we won the best sustainable construction booth, which was also another great achievement from our side. Electric vehicles all around Oman. We have about 59 DC chargers. These are fast speeding chargers and 74 AC chargers in 66 different locations in Oman. And the whole intention is to increase that in order to have even a bigger range. Clean technology in terms of vapor recovery systems, we have about 23 of them. And not only does this help in terms of reducing our CO2 emissions, but it also gives us a good return on investment as we are able to capture the vapor and then liquefy it and reuse again. So that's a great achievement from that side. 12 solar stations, we have contributed in terms of reducing our CO2 as well as reducing our costs. And other scopes, we are looking in terms of how we can look at decarbonizing. In terms of alternative energy, mainly biodiesel and hydrogen, we have continued on with our biodiesel by providing this option to companies where they can reduce their emissions as well as we are still waiting, although we signed with the government last year for the green corridor of providing hydrogen, we're still waiting for the government so that we can sign the offtake agreement. And the last part is the ESG. We started in 2023 when it was not mandatory, but it was a good practice. We've managed to do that. And [Foreign Language] 2024, we've already provided our mandatory one as per the requirements. Maybe Musaab, you want to take over that?

Sure. [Foreign Language] We have here our first half results, and I'll present it on the left side, which is our group. As Mr. Tariq has highlighted earlier, our growth has -- our revenue has grown significantly, about 5.8% for the group, mainly attributable to our retail, which is the bulk of our parent company operations as well as our commercial side and our international subsidiary, Saudi Arabia, which we saw earlier 33%. [Foreign Language] this also translated to a gross profit increase as well of about 6.5% and other income as well an improvement due to our rental as well as other areas of business. You can see in our operating side, although our expenses increased, that's the parent company operating expenses have actually decreased because of optimization. You can see [indiscernible] investments with subsidiaries impact increased by about 1.1%, but still a healthy growth, translated overall to a very healthy bottom line increase year-on-year compared to the previous year of about 91.5%, closing the first half at OMR 3.35 million. We anticipate [Foreign Language] to continue to grow on the space to the year-end. And we have a very positive outlook for this year and moving forward as well. We will now open the floor to questions.

Any questions? Okay. I think what we'll do is we'll wait for another 2 minutes. Maybe if we don't hear any questions, we'll consider that this is -- the session is closed. So we'll wait for 2 minutes. Okay. Well, thank you. Thank you very much. Since we didn't have any questions, we'll consider this session closed. I would like to thank you all, and we look forward to seeing you in the next quarter. [Foreign Language] And have a good day.