Global marine terminal operator DP World on Thursday announced that it recorded $604 million full-year profit attributable to shareholders, an increase of 10.9 per cent on previous year’s $545 million, beating analysts’ forecasts.
A cargo ship uploads containers at the Jebel Ali port in Dubai. Global marine terminal operator DP World’s new investments across its portfolio of ports totalled more than $1 billion. — AP
The Dubai-based ports operator, the world’s third-largest by throughput, said the profit surge (26.6 per cent on a like-for-like basis) was due to its focus on higher-margin business at its 60-plus terminals across the globe.
Revenue of $3.07 billion (3.6 per cent up year-over-year) dropped 1.5 per cent from $3.12 billion. In a statement, the port operator said it booked $659 million from asset sales last year. The sales helped it reduce leverage, while new investments across its portfolio of ports totalled more than $1 billion.
The company also announced 23 US cents per share, which is 10 per cent more than that given in the previous year.
DP World Chairman Sultan Ahmed bin Sulayem said this performance has been achieved despite the group facing some challenging market conditions, particularly in the first half of the year, and being capacity constrained within a number of its key locations.
“Our portfolio remains well positioned to capitalise on the significant medium to long-term growth potential of this industry due to our continued focus on the faster growing markets and stable origin and destination cargo. This positioning combined with our ability to add new capacity will enable us to deliver both earnings growth and shareholder value over the long term,” he said.
“Following the strong financial performance, combined with the realisation of profit from the monetisation of assets during the year, the Board of DP World is recommending a total dividend of $190.9 million, or 23 US cents per share. This comprises a 10 per cent increase in the ordinary dividend. The board is confident of the company’s ability to continue to generate cash and support our future growth whilst maintaining a consistent dividend payout,” said Sulayem.
“Looking ahead, while the outlook in some regions remains challenging, we have demonstrated our ability to remain profitable despite these headwinds,” Chief Executive Mohammed Sharaf said in the statement.
“We have made an encouraging start to 2014 and, for the year as a whole and beyond, we expect to see a return to normalised volume growth driven by the addition of new capacity in our portfolio and a gradually improving macro environment,” Sharaf said.
Sharaf said the company remained on track and on budget with respect to its 2012-2014 $3.7 billion capital expenditure programme.
“During 2013, we opened our new state of the art facility at London Gateway (UK) and Embraport (Brazil), while adding one million TEU of much needed new capacity in the UAE. We are encouraged by the performance of our new operations and in 2014 we look forward to adding further capacity at Jebel Ali (UAE) and Rotterdam (Netherlands). The opening of Jebel Ali’s Terminal 3 will add another four million TEU and take total capacity to 19 million TEU.”
In February, DP World reported 0.7 per cent year-over-year growth in container volumes for 2013 to 55 million standard shipping containers.
DP World said its European ports continued to show weakness last year, but the company is expecting better performance in 2014, aided by healthy expected growth in global trade.
In the UAE, the company had another record year with throughput reaching 13.6 million TEU despite being capacity constrained at the start of the year, it said. While resilience in its UAE and Africa portfolio mitigated the weaker markets elsewhere, market conditions in the Middle East, Europe and Africa region were mixed.
DP World’s consolidated volumes fell 3.8 per cent to 26.1 million TEU — or twenty-foot equivalent container units — in 2013, down from 27.1 million a year earlier.
DP World’s net profit of $604 million, however, exceeded projections made by NBK Capital ($567 million) and EFG Hermes estimate of $589 million.
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