DP World profits fall as owner of P&O Ferries warns of ‘uncertain’ outlook
- DP World reported that profits fell 9.7% to $651 million in the six months ended June
- Trade was hit by freight rates that continued their decline from record levels
- The group’s headquarters are located in Dubai and the group’s ports include Jebel Ali and Southampton
DP World warned of an ‘uncertain’ outlook after the port operator announced a fall in half-year profits.
The Emirati-run company, which owns P&O Ferries, saw profit attributable to owners fall 9.7 percent to $651 million (£510 million) for the six months ending June.
Earnings fell despite shipping freight rates continuing to fall from record levels seen in mid-2021 amid improving supply chain issues and a global economic slowdown.
Logistics giant: DP World is headquartered in Dubai and DP World’s ports include Jebel Ali (pictured), the busiest in the Middle East, and Southampton and London Gateway in the UK
DP World warned that the immediate outlook remained hampered by geopolitical factors, high inflation, recent rate hikes and currency fluctuations.
The group is owned by Dubai World, an investment company that operates on behalf of the government of Dubai.
DP World still managed to increase total sales by 13.9 percent to just over $9 billion, thanks to solid performances from its Imperial Logistics and Drydocks World businesses.
Container volumes also suffered from the broader market, rising 3.1 percent to 39.9 million 20-foot equivalent units (TEUs), with the Asia-Pacific region driving growth and weaker trade in the North and South America and Europe compensated.
Sultan Ahmed Bin Sulayem, chief executive and chairman of DP World Group, said: “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 to achieve steady growth. series of annual figures.
“We remain optimistic about the medium to long-term outlook for the industry and DP World’s ability to consistently generate sustainable returns.”
The global container fleet is expected to grow by 6.3 percent in 2023 and 8.1 percent next year, according to the Baltic and International Maritime Council, an industry organization that represents shipowners.
Headquartered in Dubai, the logistics giant’s ports include Jebel Ali, the busiest in the Middle East, and Southampton and London Gateway in the UK.
It handled about 79 million containers through its network last year and plans to increase its capacity by an additional 3 million TEU by the end of 2023.
DP World invested $910 million in its estate in the first half of this year and expects to spend a total of $2 billion by the end of December.
The company sparked public outrage in 2022 when P&O Ferries, which it initially bought for £3.3bn in 2006, abruptly laid off 800 UK workers without notice and replaced them with temporary workers.
P&O boss Pete Hebblethwaite admitted the move was illegal because the company failed to give authorities 45 days’ notice before planning to make layoffs and failed to consult unions.