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Abu Dhabi, UAEMonday 17 December 2018

DP World gross container volume advances 10.7% in second quarter

Gross container volume rises to 17,596 twenty-foot equivalent units

 The ‘Traders Market’ will help Chinese, local and international manufacturers capitalise on Dubai’s strategic location as a business and trade hub. Pawan Singh / The National
 The ‘Traders Market’ will help Chinese, local and international manufacturers capitalise on Dubai’s strategic location as a business and trade hub. Pawan Singh / The National

DP World, the world's fourth largest terminal operator, said gross container volume advanced 10.7 per cent on a reported basis in the second quarter on the back of a rise in global trade.

Gross container volume advanced to 17,596 twenty-foot equivalent units (TEU) compared to 15,898 TEU in the same period last year. An increase on a reported basis includes volumes from new terminals.

The biggest growth in volumes during the quarter came from the Americas and Australia regions, which together registered a 17.1 per cent jump in the three months ended June to 2,153 TEU, compared to 1,839 a year earlier. The second biggest growth came from Europe, Middle East and Africa with 12.7 per cent, followed by Asia Pacific & India Subcontinent with 7.3 per cent.

In the UAE, volumes in the first half grew 4.3 per cent to 7.7 million TEU, and 6.6 per cent in the second quarter.

“Our portfolio has delivered ahead-of-market growth benefiting from the improved trading environment in 2017 and market share gains from the new shipping alliances, driving volumes in the second quarter," said Sultan bin Sulayem, group chairman and chief executive.

"The robust performance was delivered across all three regions, which once again demonstrates that we have the right strategy and the relevant capacity in the key markets. We are pleased to see our terminals in the Americas and Europe continue to deliver growth. Encouragingly, UAE volumes have improved and we continue to expect our portfolio’s volume growth to outperform the market."

Mr bin Sulayem added that based on the company's first-half performance DP World was on track to meet full year 2017 market expectations.

The operator posted a 16 per cent rise in full-year net profit in 2016.

There are "several positive signs from the announcement", said Wafaa Baddour, an analyst at the Cairo-based Egyptian investment bank EFG-Hermes.

Ms Baddour noted that UAE volume returned to its second quarter of 2015 peak level and that although third quarter volume would be pressured by the trade ban with Qatar, the company's management expects minimal impact on profitability.

The company has also been expanding this year. This month DP World signed an agreement in Indonesia to advise on the development of two ports, strengthening the UAE’s position in the world’s largest Muslim country.

The port operator signed a technical assistance contract with the Indonesian government to help develop the Kuala Tanjung greenfield port and logistics zone as well as the Belawan port, located in north Sumatra.

In addition to sharing its experience, DP World will develop multi-modal transport hubs. The Dubai port operator will also review Belawan port operations to help shore up efficiencies while looking for ways to cut costs to build the new Kuala Tanjung port and logistics zone. The company said the agreement was expected to have a “far-reaching positive impact on the social and economic growth of the region”.