Dubai: Salik records Dh1.1-billion revenue in H1 after 238 million vehicles use toll gates

The company announced the distribution of interim cash dividends worth Dh544.8 million

Angel Tesorero

Published: Tue 13 Aug 2024, 10:40 PM

Salik Company PJSC, Dubai’s exclusive toll gate operator, saw 238.5 million vehicles pass through its eight toll gates from January to June this year, resulting in Dh1.1 billion half-year revenue, up by 5.6 per cent from the same period last year.

Revenue from toll usage, comprising 87.1 per cent of total revenue, rose by 4.9 per cent year-on-year to Dh953.8 million. During the first half of 2024, Salik reported EBITDA (earnings before interest, taxes, depreciation, and amortization) of Dh738.4 million, up 6.5 per cent year-on-year, and profit before tax of Dh598.6 million, up 9.2 per cent year-on-year.

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In the first three months of 2024, Salik registered a stronger revenue amounting to Dh562 million, which dropped in the second quarter – between May and June 2024 – to Dh 532.7 million but still up by 3.1% when compared to Q2 2023.

Salik sustained a robust net profit of Dh267.5 million for the second quarter and total of Dh544.8 million profit for the first half of the year.

In view of the strong financial results, the company announced the distribution of interim cash dividends amounting to Dh544.8 million, equivalent to 7.263 fils per share, payable on September 5 this year.

Diversification and growth

Mattar Al Tayer, chairman of the Board of Directors of Salik, said: “Since the beginning of 2024, we have focused on expanding our core tolling business while diversifying our revenue streams through new strategic initiatives. The addition of two new toll gates in Dubai (Business Bay Crossing and Al Safa South gates) – scheduled to be operational by the end of November 2024 – and our recent parking solutions partnership with Emaar Malls, which became operational in July this year, underscore our commitment to diversification and growth.”

Salik expanded its revenue stream with the barrier-free system operational at Dubai Mall since July 1, when paid parking was implemented in Grand, Cinema, and Fashion parking areas. The Zabeel and Fountain View parkings, meanwhile, remain free of charge for the time being.

4.2M cars have Salik

Registered vehicles with Salik tags now stand at 4.2 million, up by 8.8 per cent as compared to H1 2023. Registered active accounts increased 14.6 per cent YoY (year-on-year) – about 2.5 million from around 2.2 million in Q2 2023.

Salik, meanwhile, 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 remained relatively stable year-on-year at around 2 million trips.

Salik’s revenue-generating trips reached 115.7 million in the second quarter of 2024, up 1.6 per cent as compared to Q2 2023. Jebel Ali toll gate posted a double-digit growth (+c.10 per cent), while Al Maktoum Bridge and Al Safa toll gates registered +c.4 per cent and +c.3 per cent growths, respectively.

Salik CEO Ibrahim Sultan Al Haddad noted: “The increase in revenue-generating trips and active accounts achieved in Q2 2024 reflects our strategic efforts to meet growing demand for efficient transportation. Dubai continues to strengthen its position as a global tourism hub, attracting more international visitors than ever before. The city continues to attract new residents and businesses, and we are proud to play a pivotal role in making Dubai one of the most accessible cities in the world.”

Revenue summary

On toll usage fees, Salik reported that “revenue continued to increase during the second quarter of 2024, supported by the inflow of tourists and increased movement of individuals across Dubai. Toll usage fee revenues increased by 1.6 per cent, to Dh462.7 million.

Revenue from fines increased by 8.4 per cent or Dh57.2 million, contributing 10.7 per cent to total revenue. The number of net violations (accepted minus dismissed violations) grew 8.5 per cent YoY in Q2 2024, reaching around 672,000.

Tag activation fees grew strongly in the second quarter, with revenue increasing 53.0 per cent YoY to Dh10 million. Tag activation fees contributed 1.9 per cent of total revenues in the quarter.

Further outlook in 2024

Salik said it will revise its financial guidance and outlook for the 2024 fiscal year, with an update to be provided to the market (later this month) following completion of assessing the positive financial impact of the two new toll gates, as well as the assumption that the Floating Bridge will remain closed until year-end.

The company is also looking at the impact of revenue to be generated from collecting parking fees at Dubai Mall and the impact of the 2.5 per cent reduction in the RTA concession fee effective from April 1, 2024.

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