DP World delivers profit of over $1B for first time

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Global port operator DP World’s performance soared in 2016 as profit topped US$1 billion and adjusted EBITDA margin for the full year reached a new high.

In a statement, the Dubai-based company said its profit rose in 2016 to $1.127 billion, up 27.6% over the same period in 2015, while revenue for last year grew 4.9% to $4.163 billion, the growth supported by the full-year contribution of Jebel Ali Free Zone in the UAE and Prince Rupert in Canada.

Adjusted EBITDA likewise increased, posting a 17.4% growth to $2.263 billion, with adjusted EBITDA margin of 54.4%, which is a new high and reflects the Jebel Ali Free Zone acquisition and increased contribution from other higher margin locations.

Like-for-like, revenue grew 1.3%, adjusted EBITDA increased by 6.6% with adjusted EBITDA margin of 52.6%, and attributable earnings increased 6.2%.

Volume grew 0.4% despite challenging markets, and containerized revenue per TEU expanded 4.0%. Total revenue per TEU went up by 3.0% on a like-for-like basis. Total containerized revenue grew by 3.8% on a reported basis and 2.3% on a like-for-like basis.

DP World group chairman and CEO Sultan Ahmed Bin Sulayem said, “We are pleased to announce another set of strong financial results for 2016, as we delivered earnings in excess of $1 billion and above 50% EBITDA margins for the full year for the first time.”

He added that volumes have continued to grow ahead of the market with gross volumes growing 3.2% against Drewry’s full-year market estimate of 1.3%. “This is pleasing given the significant challenges parts of our portfolio have faced, and once again demonstrates the resilient nature of our diversified portfolio.”

The company said it made continued investments in high-quality, long-term assets to drive long-term profitable growth, noting that capital expenditure reached $1.298 billion invested across the portfolio during the year.

By the end of 2016, gross global capacity was at 85 million TEUs, an increase of about 15 million TEUs since 2012, and “we expect over 100 million TEU of gross capacity by 2020, subject to market demand,” said DP World.

Capital expenditure in 2017 is expected to amount to $1.2 billion with investment planned for Jebel Ali, Prince Rupert,  Berbera (Somaliland), Dakar (Senegal), and London gateways (UK).

“While 2017 is expected to be another challenging year for global trade, we have made an encouraging start to the year and we expect to continue to deliver ahead-of-market volume growth. Our aim is to continue our disciplined approach to capital allocation in markets with strong growth potential while adding complementary or related services to further diversify and strengthen our business,” said Sultan Ahmed Bin Sulayem.

Photo courtesy of DP World