DP World 2012 Profit Jumps on Asset Sales, Beats Estimates

DP World Ltd. (DPW) posted a 21 percent jump in full-year profit, beating estimates as the world’s third-largest port operator sold assets to focus on growth in emerging markets.

Net income attributable to shareholders rose to $555 million, or 90 cents a share, from $459 million last year or 82 cents a share, the Dubai-based company said in a statement to Nasdaq Dubai today. The mean estimate of eight analysts was for net income of $511 million, according to data compiled by Bloomberg. Revenue climbed 5 percent to $3.1 billion.

DP World, which operates more than 60 terminals in six continents, made $249 million from asset sales in Australia, Europe and the Middle East. The company last month said it is selling its stakes in two container terminals and a logistics center in Hong Kong for $742 million as part of a reshuffle of assets in favor of fast-growing emerging markets.

“We have continued to actively manage our portfolio to maximum advantage, divesting non-core or low-return assets, and repaying debt,” Chairman Sultan Ahmed Bin Sulayem said in the statement. “This has enabled us to move capital into those markets where we see more profitable returns whilst significantly reducing our leverage and strengthening our capital base.”

‘Uncertain Environment’

Gross container volumes rose 2 percent to 56 million twenty-foot equivalent units during the year, while consolidated throughput increased 1 percent to 27 million TEUs. The growth was driven by operations in Africa, Middle East, South America and Asia.

“Despite the strong bottom line performance, we remain concerned about the near-term outlook given the tough start to the year as current trading appears difficult,” Redwan Ahmed, a Dubai-based analyst at investment bank EFG-Hermes Holding SAE, said by e-mail today. “Following the recent disposal in Hong Kong, DP World is underleveraged and we suspect the group could be looking to acquire assets particularly in Africa and or Latin America, where the growth prospects are attractive.”

DP World shares fell 0.6 percent to $14.02 at 10:47 a.m. in Dubai, trimming their increase this year to 20 percent. The company invested $685 million across its portfolio last year. Some of its key developments, including its London Gateway project, are on schedule to open later in 2013, it said.

Conditions so far this year are consistent with those at the end of last year and the economic environment remains “uncertain”, Chief Executive Officer Mohammed Sharaf said in the statement.

To contact the reporters on this story: Stefania Bianchi in Dubai at sbianchi10@bloomberg.net; Zainab Fattah in Dubai at zfattah@bloomberg.net

To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.net

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