NMDC Energy’s 3Q net income more than halves + Adnoc Drilling’s holds flat

Oilfield services earnings offset a weaker onshore performance to keep Adnoc Drilling’s 9M 2026 bottom line growing. Net income rose 1% y-o-y to USD 1.1 bn, while revenue rose 2% to USD 3.7 bn, according to the company’s interim financial statements (pdf). Net income for 3Q alone was flat y-o-y at USD 366 mn. The company kept its FY 2026 guidance of about USD 5 bn in revenue and USD 1.45 bn in net income, according to its earnings release.

Customers are carrying much of the higher transport bill: Many of Adnoc Drilling’s contracts are cost-plus, letting it pass on higher transportation costs linked to regional disruption to customers, CFO Youssef Salem told Asharq Business. Those customers are also gaining from higher oil prices, which lets the company hold its margins, he said.

New offshore capacity and regional operations drove the top line:Onshore revenue rose 5% y-o-y as regional operations were consolidated, partly offset by the planned phasing of unconventional activity and the repurposing of some onshore rigs. Offshore revenue rose 4% on added capacity, including an AI-enabled island rig deployed in June, which more than offset the planned repurposing of two jack-up rigs in 3Q.

More drilling work is in the pipeline: Adnoc Drilling is set to carry out a 14-well, AED 1.3 bn drilling program as part of Adnoc’s USD 6.2 bn Umm Shaif gas-cap development, which reached a final investment decision in July.

What’s next: Adnoc Drilling plans to expand its fleet from 172 rigs to around 180 by end-2027, alongside acquisitions and entry into new markets, he added. It has also submitted the best offers in tenders for two offshore rigs in Kuwait, with awards expected before year-end. Adnoc expects earnings growth in 4Q as additional rigs enter service, followed by higher revenue in 2027, Salem adds.

Margin call

Cost overruns tied to the regional situation weighed on NMDC Energy’s 3Q earnings. Net income fell 54.1% y-o-y to AED 168.8 mn, while its revenues slipped 2.3% y-o-y to AED 4.7 bn, according to the company’s financial release (pdf). For 9M, net income dropped 55.8% y-o-y to AED 418 mn, while revenue rose 9.3% y-o-y to AED 14.2 bn.

Projects are costing more to deliver. NMDC Energy blamed “cost overruns related to logistics, ins., and fuel prices amid the ongoing regional situation,” which it says started in March. Direct costs rose 2.2% y-o-y to AED 4.5 bn in 3Q. That cut gross income by 42.6% to AED 280.9 mn and the gross margin to 5.9% from 10.1%, according to the company’s interim financial statements (pdf). The EBITDA margin narrowed to 6.2% from 9.7%. Over 9M, direct costs climbed 14.6%, outpacing revenue.

The orderbook jumped in October. Backlog reached AED 33 bn including awards through 25 October, up from AED 29.8 bn at the end of September. Most of that jump likely reflects the three offshore EPC contracts worth USD 763.3 mn (c. AED 2.8 bn) it signed with Aramco this month. Over 9M, it secured AED 2.6 bn in new awards, AED 2.3 bn of it from a single offshore EPC contract with an undisclosed UAE client. UAE work made up 72% of 9M revenue. Capex reached AED 314 mn, mostly for building its KSA yard and upgrading its UAE yards. It runs four yards, three in the UAE and one in KSA, according to the company’s press release (pdf).