DP World’s H1 Profit Flat, Cites Global Climate

Dubai’s DP World, the world’s third largest port operator, reported flat profits for the first half of this year as growth in its regional operations offset tough global trading conditions.

The company, one of the more profitable assets of debt-laden Dubai World, made a profit of $247 million, barely changed from $246 million in the year-earlier period, it said on Wednesday.

Revenue for the six months ended June 30 was $1.53 billion compared to $1.50 billion in the prior-year period.

“The global economic uncertainty seen in the first half of the year has continued into the second half,” Mohammed Sharaf, chief executive of DP World, said in the statement.

Revenue from its Middle East, Africa and Europe operations totalled $1 billion, an increase of 14 percent. But revenues from operations in the Asia-Pacific, the Indian subcontinent, Australia and the Americas all dropped during the period.

The firm said it expected to make investments worth $3.7 billion between 2012 and 2014. The company’s net debt stands at $3.5 billion, it added.

DP World repaid $3 billion of debt in March using some of the cash held on the group’s balance sheet, reducing gross debt to $4.7 billion and cutting its cash balance to $1.2 billion.

“We have enough cash reserve,” Yuvraj Narayan, chief financial officer for DP World, said in a conference call following the earnings announcement. He added that the firm had no immediate plans to raise any funds.

The ports operator previously announced a 7.5 per cent rise in gross container volumes for the first half of this year but warned that uncertainty in the global economy was slowing growth of the industry.

The company has gradually shifted attention to emerging markets to help offset a possible economic slowdown.

DP World was forced to hand over its 60 per cent holding in Adelaide’s container terminal to Flinders Port in July, after the Australian firm exercised its right to buy the stake.

The port authority in the Yemeni city of Aden said last week that it was in talks with DP World on cancelling a contract to manage Aden port. DP World declined to comment on this issue on Wednesday.

Shares in DP World are up 5.3 per cent on Nasdaq Dubai this year.