Dubai: The Dubai port and free zone operator DP World chiseled out a 3.3 per cent revenue growth to $9.33 billion for the first fix six months of 2024, but saw profit slip 35.6 per cent to $570 million in a tough environment for the shipping and logistics industry.
“2024 has been marked by a deteriorating geopolitical environment and disruptions to global supply chains due to the Red Sea crisis,” said Sultan Bin Sulayem, Chairman and CEO. “Nevertheless, our strategic emphasis on high-margin cargo, comprehensive end-to-end supply chain solutions, and stringent cost management have been crucial in achieving this financial performance.”
Focus is on resilience
DP World looks to ride out the current tough conditions for the industry through further expansion of its network in key overseas markets. To help the process along, 'our balance-sheet remains strong, and our operations continue to produce substantial cash flow," said Bin Sulayem.
We remain optimistic about the medium- to long-term prospects of the industry and DP World’s ability to deliver sustainable returns consistently
"This financial strength provides the flexibility to further invest in our current portfolio’s growth and to seize new investment opportunities as they emerge.
"While the near-term trading outlook remains uncertain due to macroeconomic and geopolitical headwinds, the resilient financial performance of the first-half and the positive momentum as we enter the second-half, positions us well to deliver stable full year adjusted EBITDA."
Higher capex
The capital expenditure for the first-half came to $994 million, against $910 million a year ago, and was invested across the existing portfolio. Of this, $593 million went towards ports and terminals, $278 million for logistics and parks and economic Zones, $122 million into marine services, and $1 million in the head office.
The capex guidance for whole of 2024 is for around $2 billion, which would be invested in Drydocks World, London Gateway, inland logistics (India), Dakar (Senegal), East Java (Indonesia), Callao (Peru), Jeddah (Saudi Arabia), Dar Es Salam (Tanzania) and DP World Logistics (Africa) and Fraser Surrey Docks (Canada).
"In logistics, our investments have been focused on organically expanding our freight forwarding platform, which now encompasses over 90 per cent of global trade across more than 150 locations worldwide," said Bin Sulayem. "Strategic investments in sectors poised for high growth allow us to provide value-added services, and we remain dedicated to continuously improving our logistics capabilities.
"This includes tackling supply chain inefficiencies and enhancing connectivity in key trade corridors to better support cargo owners.
