Dubai-based global marine terminal operator DP World has announced strong financial results from its global portfolio for the 12 months ending 31 December 2016, which saw the company achieve net income of over $1 billion for the first time.
On a reported basis, revenue grew 4.9 per cent and adjusted EBITDA ($2.263 billion) increased 17.4 per cent with adjusted EBITDA margin of 54.4 per cent, delivering profit attributable to owners of the company, before separately disclosed items, of $1.127 billion, up 27.6 per cent, and EPS of 135.7 US cents, said a statement from the company.
On a like-for-like basis, revenue grew 1.3 per cent, adjusted EBITDA increased by 6.6 per cent with adjusted EBITDA margin of 52.6 per cent, and attributable earnings increased 6.2 per cent, it added.
The company reported a revenue of $4.163 billion, a growth of 4.9 per cent supported by full year contribution of Jebel Ali Free Zone (UAE) and Prince Rupert (Canada). Like-for-like revenue increased by 1.3 per cent driven by a 2.3 per cent increase in containerised revenue.
The group reported a volume growth of 0.4 per cent despite challenging markets. Containerised revenue per TEU (twenty-foot equivalent unit) grew 4 per cent and total revenue per TEU by 3 per cent on a like-for-like basis.
The group raised $1.2 billion in a new 7-year sukuk transaction at significantly improved terms, refinancing $1.1 billion of the existing 2017 sukuk through a tender offer and extending the debt maturity profile.
Furthermore, it raised £650 million 20- and 30-year multi tranche term financing placed with pension funds, insurance companies and financial institutions for London Gateway Port, and Canadian $603 million 7-year bank loan for the Canadian business. This further extends the debt maturity profile and reduces the refinancing risk of DP World.
By the end of 2016, gross global capacity was at 85 million TEU, an increase of approximately 15 million TEU since 2012, and the gourp expects over 100 million TEU of gross capacity by 2020, subject to market demand.
“We expect capital expenditure in 2017 to be $1.2 billion with investment planned into Jebel Ali (UAE), Prince Rupert (Canada), Berbera (Somaliland), Dakar (Senegal) and London Gateway (UK),” it said.
Sultan Ahmed Bin Sulayem, group chairman and CEO, DP World, said: “We are pleased to announce another set of strong financial results for 2016, as we delivered earnings in excess of $1 billion and above 50 per cent EBITDA margins for the full year for the first time.”
“Encouragingly, our volumes have continued to grow ahead of the market with gross volumes growing 3.2 per cent vs Drewry full year market estimate of 1.3 per cent. This is pleasing given the significant challenges parts of our portfolio have faced, and once again demonstrates the resilient nature of our diversified portfolio,” he said.
“Disciplined investment throughout the economic cycle has been one of the keys to delivering consistent growth and in 2016, we invested $1,298 million across our portfolio in markets with strong demand and supply dynamics,” he stated.
Bin Sulayem added: “While 2017 is expected to be another challenging year for global trade, we have made an encouraging start to the year and we expect to continue to deliver ahead-of-market volume growth. Our aim is to continue our disciplined approach to capital allocation in markets with strong growth potential while adding complementary or related services to further diversify and strengthen our business.”
“The board of DP World recommends increasing the dividend by 26.7 per cent to $315.4 million, or 38.0 US cents per share, reflecting the strong earnings growth in the year. The board is confident of the company’s ability to continue to generate cash and support our future growth whilst maintaining a consistent dividend payout,” he stated.
“Our significant cash generation and investment partnerships leave us with a strong balance sheet and flexibility to capitalise on the significant growth opportunities in the industry. Overall, we continue to believe that a portfolio which has a 70 per cent exposure to origin and destination cargo and 75 per cent exposure to faster growing markets will enable us to deliver enhanced shareholder value over the long term,” he concluded.