DP World sees mixed performance in H1

DP World sees mixed performance in H1

DP World saw a mixed bag of operating results from its operations around the world in the first half, with the Europe, Middle East and Africa (EMEA) region still making up the lion’s share of its volumes with a 3.1% rise in consolidated throughput to 11.54 million TEU from 11.18 million TEU in the first half of 2017.

“Market conditions in the Middle East, Europe and Africa region have been mixed,” DP World said in a press release. While its Europe terminals saw strong performances, UAE volumes have remained broadly flat.

Markets conditions in the Asia Pacific and Indian Subcontinent region were stable, DP World said and the one percent growth in volume to 5.05m TEU made up the next largest component of global container terminal operator’s overall throughput.

In Australia and the Americas, DP World’s smallest market segment by volume, market conditions have been mixed, it said.

Although volumes spiked 18.2% to two million TEU, they remained broadly flat after normalization for the consolidation of the massive DP World Santos in Brazil, which the group took full control of at the end of 2017.

The region has also done very well for DP World on a financial basis, with revenues growing by 18.7% to $431 million as they were boosted by the acquisition of Cosmos Agencia Marítima in Peru and the consolidation of DP World Santos.

DP World spent $439 million on capital expenditure (capex) in the first half of 2018. The group expects full-year capex to remain unchanged at up to $1.4 billion to be invested in UAE, Posorja (Ecuador), Berbera (Somaliland), Sokhna (Egypt) and London Gateway (UK).

“Our focus in the near term is to continue to manage our growth capex in a disciplined manner and to integrate the new acquisitions. Being financially disciplined has served us well over the years and it remains a priority,” said DP World Group chairman and CEO Sultan Ahmed Bin Sulayem.

“Our balance sheet remains strong with leverage of 2.9 times and cash on the balance sheet of $1.51 billion, giving us the flexibility to continue to seek growth opportunities in port and other related maritime markets, should they become available at attractive prices,” he added.

He noted that while the group had been diversifying its revenue base into complementary sectors in recent acquisitions, the container terminal business will remain DP World’s core business. “We aim to continue to add capacity in key growth markets while maintaining the existing shape of our portfolio that has a 70% exposure to origin and destination cargo and 75% exposure to faster growing markets,” he concluded.  

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