Dubai’s Salik Maintains 49.4% Net Profit Margin, Forecasts 6%–8% Revenue Growth for 2027.
Dubai’s exclusive toll gate operator, Salik, recorded a net profit of Dh1.04 billion for the nine months ended September 30, marking an 8.6 per cent decline compared with the same period last year.
In its financial results announced on November 13, the company reported a 6.9 per cent year-on-year drop in revenue to Dh2,117.3 million.
However, its third-quarter performance showed signs of improvement, with revenue, earnings before interest, taxes, depreciation and amortisation (EBITDA), and net profit all recording gains compared with the previous quarter.
Revenue for the third quarter increased 3.2 per cent from Q2 to Dh705.3 million. The year-on-year decline also narrowed to 5.7 per cent, compared with 11.9 per cent in the previous quarter.
EBITDA rose 1.2 per cent quarter-on-quarter to Dh474 million, while net profit increased 1.9 per cent to Dh341.1 million in Q3.
Road traffic shows signs of recovery
Salik’s profitability margins came under pressure during the third quarter, with its EBITDA margin declining to 67.2 per cent from 69.4 per cent in the same period last year.
The company attributed the decline partly to a higher concession fee, which accounted for 23.1 per cent, alongside increased operating, maintenance and staffing expenses. Higher software spending and provider commissions also weighed on margins, particularly against a smaller revenue base.
Toll usage fees, Salik’s primary source of income, amounted to Dh1.809 billion, representing a 10.1 per cent year-on-year decline. However, the shortfall in Q3 narrowed to 7.3 per cent, compared with 16.5 per cent in the previous quarter.
Revenue from fines reached Dh220.1 million, up 6.5 per cent, while tag activation fees increased 8.5 per cent to Dh37.7 million.
Ancillary revenue recorded a stronger performance, surging 82.5 per cent to Dh26.5 million, largely driven by the company’s parking partnership with Parkonic.
Salik also reported a recovery in road traffic following the regional crisis that began in February. The number of toll-gate trips reached 194 million in Q3, marking a 4 per cent increase compared with the second quarter.
Peak-hour trips during the nine-month period were 2 per cent higher than a year earlier, while September recorded the highest monthly traffic volume since February.
Ibrahim Sultan Al Haddad, Salik’s chief executive, highlighted the company’s improved cash generation and financial position.
“Cash generation strengthened markedly,” he said.
Net debt to EBITDA improved to 2.29 times from 2.45 times at the end of Q2, remaining comfortably below the company’s covenant limit of five times. Al Haddad said this provided Salik with “considerable flexibility to pursue its growth priorities”.
Chairman Mattar Al Tayer attributed the performance to the company’s business model and operational capabilities.
The results “reflect the strength of its business model, operational efficiency, and ability to capitalize on Dubai’s rapid economic and urban growth,” he said.
Looking ahead, Al Haddad pointed to Dubai’s long-term population growth prospects, with the emirate’s population projected to reach 5.8 million by 2040.
The Dubai 2040 Urban Master Plan also identifies five key urban centres for expansion, three of which are located near Salik’s toll gates along Sheikh Zayed Road.
Salik sets revenue growth target for 2027
Salik is continuing to expand its technology capabilities and diversify its revenue streams through strategic partnerships.
In September, the company renewed its technology partnership with TransCore for another five years. It also introduced seamless parking payments at Dubai Harbour’s Harbour West Car Park through an agreement with Shamal.
The company employed 63 full-time staff during Q3, representing a 21.2 per cent increase compared with the same period last year. Emiratisation stood at 31.8 per cent.
For 2027, Salik has outlined the following financial targets:
- Revenue growth: 6 to 8 per cent.
- EBITDA margin: 69.5 to 70.5 per cent.
- Net profit margin: 50.5 to 51.5 per cent.
The company expects its concession fee to decrease under the inflation protection mechanism, although some of the benefit is likely to be offset by inflation-related increases in operating costs.
Salik also plans to distribute 100 per cent of its net profit as cash dividends, subject to the Board’s recommendation and approval at the Annual General Meeting (AGM).
