Thursday, August 16, 2018

Container Port and Logistics Group Publish Half Year Results After Recent Acquisitions

Respectable Results Despite Box Terminal Woes
Shipping News Feature
DUBAI – WORLDWIDE – Despite the problems port and logistics giant DP World has suffered recently with the seizure of its Doraleh container freight terminal in Djibouti, the group has still managed very respectable financial figures for the first half of 2018 with reported revenue growth of 14.4% to $2,626 million, supported by the acquisition of several new companies including Drydocks World LLC (Drydocks), Dubai Maritime City (DMC) and Cosmos Agencia Marítima (CAM).

Like-for-like revenue in the period increased by 3.0% driven by a 4.6% increase in total containerised revenue whilst adjusted EBITDA grew 7.9% and the EBITDA margin for the half year at 50.3% fell from 53.4% the previous year due to the consolidation of lower margin Maritime services businesses. DP World was again upgraded by the rating agency Moody’s from Baa2 to Baa1 with a stable outlook following the one notch upgrade in 2016.

Fitch Ratings also upgraded DP World from Bbb to Bbb+ in July 2017. Both rating agencies have upgraded DP World by two notches in 2 years and Capital expenditure guidance for 2018 remains unchanged at up to $1.4 billion with investments planned into UAE, Posorja (Ecuador), Berbera (Somaliland), Sokhna (Egypt) and London Gateway (UK). DP World Group Chairman and CEO, Sultan Ahmed Bin Sulayem, commented:

“DP World is pleased to report like-for-like earnings growth of 5.2% in the first half of 2018 and attributable earnings of $593 million. Adjusted EBITDA grew 7.9% to $1,322 million with margins at 50.3% on a reported basis and 54.4% on a like-for-like basis. This robust performance has been delivered in an uncertain trade environment, once again highlighting our operational excellence and the resilience of our portfolio.

“We have made good progress in delivering our strategy of strengthening our portfolio of complementary and port related business with approximately $1,400 million worth of acquisitions announced recently. These acquisitions offer strong growth opportunities and enhance DP World’s presence in the global supply chain as we continue to diversify our revenue base and look at opportunities to connect directly with the owners of cargo and aggregators of demand.

“Our balance sheet remains strong and we continue to generate high levels of cash flow, which gives us the ability to invest in the future growth of our current portfolio, and the flexibility to make new investments should the right opportunities arise. Going forward, we aim to integrate our new acquisitions and we continue to extend our core business into port-related, maritime, transportation and logistics sectors with the objective of removing inefficiencies in global trade, improving the quality of our earnings and driving returns.

“The near-term trade outlook remains uncertain with recent changes in trade policies and geopolitical headwinds in some regions continuing to pose uncertainty to the container market. However, the robust financial performance of the first six months also leaves us well placed for 2018 and we expect to see increased contributions from our recent investments in the second half of the year.”

Just last month DP World made another purchase, this time venturing into the European short sea market with the acquisition of Unifeeder and the full financial report can be viewed HERE or there is a short video giving basic details of results, recent acquisitions etc. HERE.

Photo: Jewel in the Crown, the DP World facility at Jebel Ali.