Dubai: DP World expects to comfortably meet a $3 billion (Dh11 billion) syndicated loan facility maturing in October, the company said yesterday after reporting a 10 per cent year-on-year increase in gross container volumes.
The Dubai-based ports operator also said its core earnings for 2011 would be in line with analyst expectations, which range between an EBITDA (earnings before interest, taxes, depreciation and amortisation) of $1.2 billion to $1.3 billion.
DP World is one of several UAE-based companies with loan facilities or sukuks due to mature this year. Bookrunners on the $3 billion loan signed in October 2007 were Barclays, Citi, Deutsche Bank and RBS.
"It [the economy] is a cycle but we are in the right place to take advantage of the current market situation. We are in a comfortable position with more than Dh4 billion cash on our balance sheet; we have the ability to deal with the maturity," said Yuvraj Narayan, DP World's chief financial officer.
DP World said in a statement to Nasdaq Dubai yesterday it handled more than 54.7 million TEUs (twenty-foot equivalent units) across its global portfolio in 2011, compared with 49.6 million TEUs in 2010.
Like-for-like volume growth stood at nine per cent compared with the previous year. DP World's share price fell 0.18 per cent to $10.95 at the close following the announcement.
"A little surprising factor is the lack of growth in consolidated volumes coming from the Asia Pacific and Indian Subcontinent regions, which grew only 1.8 per cent," said Raghu Mandagolathur, senior vice-president at Markaz, the Kuwait Financial Centre.
Mandagolathur says he expects DP World to report full year EBITDA in line with expectations, mainly on account of volume growth and lower interest costs.
"The first half of 2011 saw DP World report an all-time high EBITDA margin of 42.9 per cent. Going forward, we expect growth in earnings to come from operational efficiencies and cost management rather than from volume growth or pricing," he added.
