Zawya Dow Jones/Dubai


A worker walks towards the wharf at DP World’S Nhava Sheva port in Navi Mumbai, India. The company, which has about $3bn debt maturing next year, doesn’t need any equity and has no any immediate debt raising plans as it has about $4bn cash on its balance sheet for its current growth plans, its chief financial officer said
DP World, the Dubai-based ports operator, will focus on growing its emerging market business, even as an uncertain global economic outlook makes it more challenging to forecast how global trade will develop in the second half of the year, the government-controlled company’s top executive has said.
“The impact of this uncertainty has not, as yet, been reflected in the markets in which we operate and, with our focus on the more resilient emerging markets, we still expect to deliver full-year results in line with expectations,” chief executive officer Mohamed Sharaf told reporters on a conference call.
“Historically, the second half of the year has been stronger than the first half. However, as we said in our update in July, there is uncertainty around the outlook for the global economy,” Sharaf said.
DP World, which made its long-awaited debut on the London Stock Exchange early June, said last month it was confident of outperforming the industry average in terms of container volume growth this year, but didn’t give a specific forecast for container volume growth for the full year.
“We are confident on the long-term outlook for the container industry,” Sharaf said on Thursday, noting that more than 80% of its revenues now come from emerging markets.
The company continues to look at emerging market opportunities and is potentially interested in Libya, he added.
With civil war seemingly closer to an end in the North African state, several countries and companies are seen positioning themselves to take part in what may require a multibillion-dollar redevelopment of the oil-rich country.
“Like any emerging market, we are always interested,” Sharaf said. He declined to comment on whether the company had already taken first steps on that front.
Last month, DP World bought controlling interests in two companies operating cargo terminals in Suriname, giving it a foothold in the South American state for the first time.
DP World on Thursday said its first-half profit after tax, before separately disclosed items, rose 36% year on year to $281mn, as gross volumes grew and terminal efficiencies improved.
DP World said profit for the first six months after tax, before separately disclosed items, rose to $281mn from $206mn a year earlier. The company’s first-half profit attributable to shareholders rose 50% year on year to $246mn, while the inclusion of separately disclosed items comprising the profit from the sale of a stake in its Australian port operations in March helped boost its bottom line to $705mn from $177mn in the corresponding period a year ago.
The first-half results were slightly ahead of its forecasts in terms of growth in revenue and earnings before interest, taxes, depreciation and amortization, or Ebitda, said NBK Capital, which has a ‘buy’ rating on the stock and a fair value target of $13.40 a share.
“DP World has had an excellent start to the year with gross volume growth 11% ahead of the prior period, improved revenue generation, a continued focus on cost management and improved terminal efficiencies,” Sharaf said in a statement.
DP World in March sold down its stake in its Australian operations, retaining a 25% share holding in a new joint venture, but continues to operate and manage the five marine terminals. The company recognized a gain of $436mn from the Australian transaction, it said.
The company, which has about $3bn debt maturing next year, doesn’t need any equity and has no any immediate debt raising plans as it has about $4bn cash on its balance sheet for its current growth plans, chief financial officer Yuvraj Narayan said on the conference call. He added that the company is always open to raise more cash if the right opportunity arises.
DP World shares last traded up 0.5% at $10.80 on Nasdaq Dubai.