DP World H1 profit surges

DP World's first-half profit grew as it booked a gain from the sale of its Australian operations last year, and the port operator said its emerging market focus would help it deliver on full-year goals.

The company, one of the more profitable assets of Dubai World, said it was difficult to forecast global trade for the remaining part of the year despite being a historically stronger second half performer.

"There is uncertainty around the outlook for the global economy making it more challenging to forecast how global trade will develop in the second half of the year," Chief Executive Mohammed Sharaf said in a conference call on Thursday after the firm reported its first-half earnings.

DP World is also open to other asset sales if good opportunities were available, the company said, adding that there was nothing in the pipeline for the time being.

"As and when similar opportunities present themselves we will look at them in the same way that we looked at Australia," said Yuvraj Narayan, the chief financial officer of DP World.

The port operator sold 75 per cent of its Australian port operations for $1.5 billion last year to private equity firm Citi Infrastructure Investors (CII)

The company recognised a gain of $436 million from the Austarlian transaction in March, it said in a statement.

PROFITS SURGE

DP World's first half profit, including the sale, was $705 million compared with $177 million in the same period in 2010, it said in a statement.

Excluding the gain from sale, profit stood at $246 million, a 50 per cent increase compared with $164 million for the same period last year. Gross volumes in the first half of the year climbed to 26.2 million TEU or twenty-foot equivalent container units.

First-half revenues increased 3 per cent to $1.5 billion.

DP World, whose shares began trading on the London stock exchange in June, has seen its stock fall by about 22 per cent since the much-anticipated listing.

"Over time, as markets in general improve, we will see a positive impact on valuation," said Narayan.

The company was well-positioned to meet its $3 billion upcoming debt maturity in October 2012. It had $4.1 billion in cash at the end of June 30, 2011.

"Our good performance in H1 coupled with $1.5 billion proceeds from the Australia transaction has lowered our net debt to $3.7 billion," said Sharaf.

DP World bought controlling interest in two port services firms in Suriname last month for an undisclosed amount.

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