DP World net profits up 52% in 2007 to touch $420m



DP World has recorded a 52 per cent increase in its net profits after taxes, reaching to $420 million (Dh1.5 billion) in 2007. Its total earnings before interest, tax, depreciation and amortisation (EBITDA) also jumped to around $1.150bn, a 95 per cent increase.

Sultan Ahmed bin Sulayem, Chairman of DP World, the world’s fourth-largest container port operator, announced the company would distribute a 20 per cent cash dividend, or 1.33 cent per share.
“DP World achieved large increases in its revenues last year, recording $2.7bn, a 32 per cent increase compared to results in 2006. Also the margins improved to 40 per cent due to several factors including a 12 per cent increase in the company’s gross capacity,” he said.

He added DP World volumes increased well ahead of the market during 2007, growing 18 per cent against an expected 12.2 per cent for the global market.

“Our flagship port, DP World Jebel Ali, grew to become the world’s seventh largest port, handling a record 10 million containers. Jebel Ali operations represented around 30 per cent of the total DP World operations.”
Depleting dollar value did not affect DP World results, Bin Sulayem said, because its revenues come in a vast range of currencies as it operates more than 40 ports around the world.

Bin Sulayem also rejected the idea of de-pegging the UAE dirham from the US dollar. “The dollar value is fluctuating and letting the dirham to free float will create turmoil in the domestic economy. In my opinion, the dirham should continue to peg with the dollar to avoid a lot of economic hardships in the country.

“The government is taking several measures to overcome negatives of the depleting dollar value and this will support the UAE economy in the long term.”

Bin Sulayem said DP World trading in early 2008 was strong. “It is still early in the year, however, the performance in January and February was strong and trading exceeded records in the same period in 2007. We believe we are well placed to deliver good results this year.

“Expanding our existing portfolio remains key and we continue to see plenty of opportunities across all regions, both in existing port operations and new developments. We are confident we will continue to win new opportunities during the course of this year and at the same time progressing our current strong pipeline of expansion and development projects.”

He added the container terminal industry has historically recorded growth of three to four times global GDP growth and DP World has outperformed the container terminal industry growth largely due to a portfolio, which is strategically focused on growing markets.

Yuvraj Narayan, chief financial officer of DP World, said the company was studying around 20 opportunities for expansion both organically and through acquisitions, adding that the firm had allocated $4.1bn for capital expenditure between 2007 and 2010.

Anil Wats, chief operating officer, said the international trade would continue to outstrip the container terminal capacity. “DP World is handling 10 per cent of the world container industry.”


DP World stock unchanged


Despite the encouraging results announced by DP World, its stock at Dubai International Financial Exchange (DIFX) closed the day flat. The share price surged to 92 cents after the announcement of the results but later it turned in the opposite direction.

“The performance of DP World share price had been disappointing over the past few months and did not reflect the 2007 results, which were ahead of expectations,” said Chairman Sultan Ahmed bin Sulayem.

He explained there were several factors negatively affecting share prices. “The international decline in equity markets and its psychological impact on investors led to this decline in DP World shares.”