New vessels to boost UASC growth by 300%

A Dh5.5 billion order for nine new container vessels has been placed by the United Arab Shipping Company (UASC), which is expecting a robust growth of 300 per cent in throughput and revenues by 2012.

The contract to build and supply the A13-type ships, each with a capacity of 13,100 20foot equivalent units (TEUs), has been awarded to Seoul-based Samsung Heavy Industries. All the vessels are expected to be delivered by the end of 2011.

UASC is embarking on an aggressive expansion programme on the back of increasing demand for commodity imports in the Middle East.

The region's shipping industry is expecting growth of 20 per cent this year. The firm plans to invest Dh7.3bn in the purchase of new vessels to raise the total from the current 41 to around 60 by 2012.

"We are raising our ambitions given the current growth in the market," Ken Bloch Soersen, President and CEO of UASC, told Emirates Business. "We want to grow at the same pace and to do this we need to broaden our capacity."

UASC registered 30 per cent growth between 2006 and 2007, with revenues up by 34 per cent and container throughput by 27 per cent. Revenues were Dh4.7bn last year compared with Dh3.6bn in 2006.

It carried 970,000 TEUs in 2007 compared with 760,000 in 2006.

Over the coming year UASC will add eight new vessels that were ordered in 2005, each with a carrying capacity of 6,919 TEUs. The ships, worth Dh3bn, will help the company achieve a targeted 30 per cent increase in throughput this year.

The first of the eight vessels was delivered last week while the rest will be delivered in the next 12 months, said Soersen.

UASC was set up in 1976 by six Gulf countries to reduce the region's dependence on foreign shipping lines. The UAE, Saudi Arabia, Kuwait, Iraq and Qatar have equal shares of 19.5 per cent each while Bahrain has a smaller stake.

The shipper is the largest locally owned carrier of containerised cargo in the Middle East and is among the largest shipping companies in the world. UASC is targeting a total of 3.5 million TEUs by 2012 and is investing Dh732m in the purchase of new containers to support the increased ship capacity.

The number

Dh7.3bn: Total planned investment by UASC to purchase new vessels