Text size:

  • Small
  • Normal
  • Large
DP World's London Gateway, a container port on the Thames Estuary, is set to open in the fourth quarter. Stephen Lock for The National
DP World's London Gateway, a container port on the Thames Estuary, is set to open in the fourth quarter. Stephen Lock for The National

DP World will spend Dh11bn to lift capacity

DP World, the world's third biggest ports operator, plans to spend US$3 billion this year and next on extending capacity after announcing a 21 per cent rise in profits last year.

DP World plans to spend nearly US$3 billion (Dh11.01bn) this year and next on extending terminal capacity as the ports operator seeks to tap new markets and cater to larger ships.

The Dubai-based company yesterday posted a 21 per cent rise in profits last year to $555 million, up from $459m a year earlier. DP World made $249m from asset sales in Australia, Europe and the Middle East.

Earlier this month, DP World said it was selling its assets in two container terminals and a logistics centre in Hong Kong for $742m.

Part of the cash will be recycled into 11 new developments and expansion projects as it focuses its strength on fast-growing markets.

"This year, we have continued to actively manage our portfolio to maximum advantage, divesting non-core or low-return assets," said the DP World chairman Sultan bin Sulayem. "This has enabled us to move capital into those markets where we see more profitable returns whilst strengthening our capital base."

Despite a tricky few years for the shipping industry caused by the global financial crisis, DP World has grown to capture a 10 per cent market share of global ports operations.

Its expansion will continue this year with the opening in a few months of Embraport in Santos, Brazil. Designed to serve Sao Paulo, Brazil's most populous city, phase one of the project will involve a capacity of 1 million standard container units, with phase two adding a further 1.5 million units.

It is also building out its home port of Jebel Ali, where it will add 1 million units of capacity at terminal 2, due to open this year, and a further 4 million units at terminal 3, opening next year.

But its focus is not only on emerging markets.

London Gateway, the container port on the Thames Estuary, is set to open in the fourth quarter of the year. It will have an initial capacity of 1.6 million units.

The expansion allows DP World to accommodate the ever-larger super-vessels taking to the water.

"We have 10 ports capable of handling up to 18,000 [unit] mega vessels," said the DP World chief executive Mohammed Sharaf.

New capacity is also planned in the next few years in Senegal, Egypt, India, Turkey, France and the Netherlands. The company's consolidated capacity was 34.7 million units at the end of last year, a figure it hopes will rise to 46.1 million by 2015.

The capital spending this year and next year would amount to nearly $3bn, said the chief financial officer Yuvraj Narayan. The company had $1.8bn on its balance sheet currently, he said.

Mr Narayan said he expected the trend of the company's revenue outstripping growth in container volumes to continue.

Gross container volumes rose 2 per cent to 56 million units last year.

Operating performance in the company's markets in the first two months of the year had been "consistent" with those experienced at the end of last year and the economic environment continued to remain "uncertain", said Mr Sharaf.

DP World's sale of its Hong Kong assets was the latest of several divestments by the company after its exit from Adelaide, Australia, more than two years ago.

Stocks in the company, one of the more profitable arms of the government-controlled Dubai World, rose 0.07 per cent yesterday to close at $14.12 on Nasdaq Dubai.

 

tarnold@thenational.ae

Back to the top

More articles


Editor's Picks

 The Greens, villas: Q1 no change. 3BR - Dh210-250,000. 4BR - Dh210-260,000. 5BR - Dh220-300,000. Q1 2013-Q1 2014 5% rise. Pawan Singh / The National

In pictures: Where Dubai rents have risen and fallen, Q1 2014

Find out how rental prices in the prime locations in Dubai have altered during the first three months of the year and the current rates you will pay according to data provided by Asteco.

 Above, the private pool of Ocean Heights' five-bedroom penthouse flat. Courtesy Christie’s International Real Estate

In pictures: Penthouse flat is height of Dubai luxury living

A five-bedroom penthouse in Ocean Heights in Dubai Marina is on sale for Dh25 million and comes with a private pool and an unparalleled view of Dubai.

 The cooling towers of the Temelin nuclear power plant near the Tyn nad Vltavou in Czech Republic. The country wants to continue expanding nuclear energy capacity despite cancelling a tender to build two new units. David W Cerny / Reuters

In pictures: Best business images for the week to April 17, 2014

Here are some of the best business images for the week to April 17, 2014.

 Three generations of the Hakimi family tend to their stall Crawford Market in Mumbai. Subhash Sharma for The National

In pictures: Shopper’s delight at Crawford Market in Mumbai

Crawford Market is an old British-style covered market dealing in just about every kind of fresh food and domestic animal imaginable. Later on renamed Mahatma Jotirao Phule, the market remains popular among locals and visitors by its old name, taken from Arthur Crawford who was the first municipal commissioner of the city.

 The Wind, Energy, Technology and Environment Exhibition takes place from April 14 to April 16. Above, the Dewa showroom during last year’s Wetex. Jaime Puebla / The National

April corporate and economic calendar for the UAE and overseas

From Cityscape to Wetex to stock-market holidays to nations reporting first-quarter GDP figures, here is our helpful calendar of April's business events in the UAE and internationally.

 Get the latest information on credit cards, bank accounts and loan products in the UAE. Mark Lennihan / AP Photo

Rates report: Latest on UAE loans, accounts and credit cards

Souqamal.com brings you the latest interest rates on banking products in the UAE.

Events

To add your event to The National listings, click here

Get the most from The National