National Central Cooling Company (Tabreed) reported a net profit of Dh320 million for the first nine months of 2026, as higher financing and operating costs associated with its expansion weighed on profitability despite growth in revenue and cooling capacity.
The Dubai-listed district cooling company said revenue increased 3 per cent year-on-year to Dh1.91 billion, supported by higher fixed-capacity charges, capacity expansion and growth across its district cooling businesses.
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However, earnings before interest, taxes, depreciation and amortisation (Ebitda) declined 2 per cent to Dh955 million, compared with Dh972 million during the same period last year.
The company maintained an Ebitda margin of approximately 50 per cent despite increased expenses linked to inflation, business development and the integration of its expanded operations.
Financing costs weigh on profitability
Tabreed said its profitability was affected by higher financing costs associated with refinancing existing debt and funding new growth investments.
The initial impact of the PAL Cooling joint venture also weighed on earnings, although the company expects its operating contribution to increase as the business expands.
The company did not disclose a year-on-year percentage change in net profit in the results announcement.
Despite these pressures, net operating cash flow increased 20 per cent to Dh882 million, compared with Dh736 million in the corresponding period of 2025.
Cash conversion stood at 92 per cent, supporting the company’s ability to fund investments, service debt and maintain shareholder distributions.
Cooling capacity expands 15%
Tabreed’s connected cooling capacity increased 15 per cent year-on-year to 1.59 million refrigeration tonnes by the end of September.
The growth was mainly driven by the acquisition of PAL Cooling, alongside the addition of 19,900 refrigeration tonnes of organic capacity over the previous 12 months.
Cooling consumption volumes increased 0.5 per cent during the first nine months, while third-quarter consumption rose 3 per cent year-on-year.
Dr Yousif Al Hammadi, Chief Executive Officer of Tabreed, said the increase in connected capacity and operating cash flow demonstrated the strength of the company’s business model.
“The continued growth in connected capacity, alongside strong operating cash generation, demonstrates the resilience of our business model and provides a solid foundation for the next phase of growth,” he said.
Dividend payments and outlook
Tabreed paid an interim cash dividend of 5 fils per share in September 2026, representing 74 per cent of its first-half net profit.
This marked the second consecutive year in which the company distributed an interim dividend.
Its net debt-to-Ebitda ratio stood at 4.6 times at the end of September, while the company maintained investment-grade credit ratings from Moody’s and Fitch.
Looking ahead, Tabreed said it would focus on integrating PAL Cooling, improving operational efficiency and managing costs while pursuing selective growth opportunities.
The company operated 99 district cooling plants across its portfolio at the end of September, including 81 in the UAE and others across Saudi Arabia, Oman, Bahrain, India and Egypt.
Source: Khaleej Times