Sunday, Mar 23, 2014

(This story was originally published on Thursday) 


 
By Asa Fitch

DUBAI--Global ports operator DP World reported a 10.9% increase in full-year net profit as it focused on higher-margin business at its 60-odd terminals and pushed further into fast-growing emerging markets.

The $604 million of net profit attributable to the owners of the Dubai-based ports operator, the third-largest in the world by throughput, beat most analysts' forecasts. Kuwait's NBK Capital had projected a $567 million net profit, while Cairo's EFG Hermes estimated profits at $589 million and Japan's Nomura at $546 million. Revenue rose by 3.6% year-over-year to $3.07 billion.

DP World has reoriented itself toward fast-growing emerging markets in recent years, selling out of operations in Hong Kong, Australia and Europe as it added to investments in India and other big Asian markets. The company, however, is still active in many developed markets, including in the U.K., where it is building the London Gateway deep-water port. The London Gateway project opened last year.

DP World booked $659 million from asset sales last year, it said in an emailed statement. The sales helped it reduce leverage, while new investments across its portfolio of ports totaled more than $1 billion. Cost containment was another driver of the rise in profits, it said.

"Looking ahead, while the outlook in some regions remains challenging, we have demonstrated our ability to remain profitable despite these headwinds," Chief Executive Mohammed Sharaf said in the statement. "We have made an encouraging start to 2014 and, for the year as a whole and beyond, we expect to see a return to normalized volume growth driven by the addition of new capacity in our portfolio and a gradually improving macro environment."

In February, DP World reported 0.7% year-over-year growth in container volumes for 2013 to 55 million standard shipping containers. Business picked up in the second half of the year as DP World's Asia Pacific and Australian terminals performed well, alongside a pickup in traffic through its home port of Dubai.

DP World's European ports continued to show weakness last year, but the company is expecting better performance in 2014, aided by healthy expected growth in global trade.

Write to Asa Fitch at asa.fitch@wsj.com

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(END) Dow Jones Newswires

23-03-14 0446GMT