DP World reports 26% rise in net profit
First half results show net profit of $332mn for port operator
DP World, one of the world's largest port operators, reported a 26% rise in net profit for the first half of the year as its container volumes and margins increased.
The company, one of the more profitable assets of debt-laden Dubai World, posted a first-half net profit of $332mn. This compares with a profit of $264mn in the corresponding period of 2013, it said in a statement.
Two analysts surveyed by Reuters had forecast DP World would make a profit of between $290mn and $300mn.
DP World's revenue for the six months ended 30 June was $1.66bn, up from $1.51bn a year earlier.
The company's consolidated throughput in the first half of 2014 was 13.9mn TEUs (twenty-foot equivalent units), up 8.5% from a year earlier. This refers to volumes only at ports that DP World controls.
"The addition of new capacity and a pick-up in global trade have resulted in a return to robust volume growth," DP World chairman Sultan Ahmed Bin Sulayem said in the statement.
"Our portfolio is well-positioned to capitalise on the significant medium- to long-term growth potential of this industry and we continue to seek new opportunities in the faster growing markets."
By 2015, DP World expects to have about 85mn TEUs of capacity globally, including ports in which the company does not have full control, and more 100mn TEUs of capacity by 2020, subject to market demand, it said.
The company's adjusted margin on earnings before interest, tax, depreciation and amortisation (EBITDA) was 46.9%in the first six months of this year, up from 45.6% in the year-earlier period.
"The near-term outlook remains encouraging, however continued geopolitical issues may result in challenges as the year progresses," chief executive Mohammed Sharaf said in the statement.
"We remain focused on delivering relevant new capacity in the right markets, improving efficiencies, containing costs and handling higher margin containers to drive profitability."
The company, which has a portfolio of about 65 terminals across six continents, signed a $3bn loan deal last month, improving terms on its debt and raising funds for expansion. It conducted a $1bn convertible bond issue in June.