Dubai: The Dubai port operator DP World was helped by 13.9 per cent growth as revenues for the first-half 2023 crossed $9 billion. Profit for the period was flat at $885 million.
DP World termed the numbers as being ‘resilient’ to continuing volatility in global trade movements.
“Despite facing a softer container market and weakened freight rates amid challenging economic conditions, our focus on high-margin cargo, end-to-end bespoke supply chain solutions and cost optimization has been crucial in securing these results,” said Sultan Ahmed Bin Sulayem, Group Chairman and CEO.
“This strategy has not only been effective during these challenging times but also lays the foundation for our sustainable long-term growth and returns.”
To keep growth happening, the Dubai entity is spending $2 billion this year as capital expenditure, including raising container volumes at some of its network of ports outside the UAE.
But the wider shipping industry is still passing through some testing times, and these could get magnified in the latter-half of the year.
What makes the global outlook for trade and shipping so uncertain?
- Geopolitics
- Inflationary environment
- Higher interest rates
- and currency fluctuations
"Our logistics vertical has demonstrated robustness in this demanding economic landscape, attracting more cargo owners to our platform," said Bin Sulayem. "The positive feedback to our end-to-end product emphasis the value of our customised solutions enables customers to conduct trade more effectively.
"Strategic investments in high-growth sectors enable us to provide value-added solutions, and we remain committed to continuously enhancing our logistics platform. This includes addressing supply chain inefficiencies and enhancing connectivity in crucial trade lanes to serve cargo owners better."
What will H2-23 hold?
While a full-scale worldwide recession may no longer be on the cards, the current concerns in the shipping industry are about growth slowing down for some of the major economies. And how that would translate into less demand for containers if trade were to slow down.
Bin Sulayem points to these uncertainties. "While the near-term trade outlook may be uncertain due to macroeconomic and geopolitical factors, the solid financial performance of the first six months positions us well to deliver a steady set of full-year results," he said.
We remain optimistic about the medium- to long-term prospects of the industry and DP World’s capacity to consistently generate sustainable returns.
