ADNOC Gas - Q1 2026 Earnings Analysis

Performance Highlights

ADNOC Gas reported Q1 2026 revenue of $5.0 billion and net income of $1.08 billion, declining 18% and 15% year-on-year respectively, as the closure of the Strait of Hormuz through March severely curtailed export and traded liquids liftings. EBITDA came in at $1.82 billion with a 36.5% margin, 107 basis points above the prior-year period despite the volume shortfall, demonstrating structural cost discipline. The single most important operating driver was the SoH-driven export volume collapse: Export and Traded Liquids volumes fell 20% to 202 TBTU and ALNG JV EBITDA dropped 51% year-on-year to $158 million, while Domestic Gas EBITDA held relatively firm at $684 million, down only 9%, underscoring the structural protection provided by the Gas Supply and Purchase Agreement. Sulphur was a rare bright spot, contributing $159 million EBITDA, a 251% year-on-year increase.

Management Outlook and Forward Catalysts

Management guided full-year 2026 net income of $3.5–$4.0 billion, assuming the Strait reopens before the end of Q2, and raised the capex envelope to $4.5–$5.0 billion to sustain growth investment through the disruption. The long-term 40%-plus EBITDA growth target by 2029 versus 2023 was reaffirmed, reinforced by the OPEC production exit, a new 25-year Ta'ziz methanol supply deal valued at $5 billion, and a new five-year TotalEnergies LNG contract worth $700–$800 million. The central investor debate for Q2 centres on the pace and timing of SoH reopening and the speed of Habshan complex restoration — bulls point to deferred volume catch-up at elevated Brent prices once shipping normalises, while bears focus on the Q2 net income guidance of only $400–$600 million, the unquantified Habshan restoration capex, and continued supply-chain pressure that could delay the 80% capacity target by year-end.