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DP World posts 6pc rise 
in Q1 container volumes

The world’s fourth- biggest port operator, said in a statement that first-quarter volumes in 27 ports the company consolidates for accounting purposes grew six percent to 6.3 million 20-foot equivalent container units (TEU).

The increase was driven primarily by the Indian Subcontinent and Australia as well as some volume growth in European ports, said the statement posted on Nasdaq Dubai. Gross volume at 49 terminals the company operates grew 15 per cent to 11.2 million TEU.

“The return of volume growth in 2010, combined with cost reduction and efficiency initiatives, will deliver an improvement in results over last year,” it said.

DP World said it remains committed to listing its shares on the London Stock Exchange and is focused on completing the process as soon as possible.

“The return of volume growth in 2010, combined with cost reduction and efficiency initiatives, will deliver an improvement in results over last year,” Mohammed Sharaf, chief executive, said.

In 2009, DP World handled more than 43.4 million TEU across its portfolio from the Americas to Asia – a decline of 6 per cent over 2008. With a pipeline of expansion and development projects in key growth markets, including India, China and the Middle East, capacity is expected to rise to around 95 million TEU over the next ten years.

Early this month, ratings agency Moody’s Investors Service has assigned a stable outlook to the sukuk of DP World.

Moody’s has confirmed the Ba1 issuer and sukuk ratings of DP World. It said the action completes the review initiated on December 8, when Moody’s lowered DP World’s ratings to Ba1 and placed them on review for downgrade both as a result of wider reductions in government support factored into the ratings of government-related issuers (GRIs), and concerns surrounding the restructuring of DP World’s parent company, Dubai World. “Over recent months, and most recently in the announced restructuring proposal for Dubai World, many of our concerns regarding the possible contagion of the parent company’s financial difficulties on DP World have been alleviated. Thus DP World has to date been successfully ringfenced from the restructuring activities of the wider group, and indeed neither its day-to-day business, nor its financial condition has experienced adverse actions on behalf of the parent firm,” the ratings agency said.

DP World’s overall 2009 financial performance was resilient despite a decline in consolidated volumes by eight per cent. The company has already recorded a four per cent increase in volumes for the first two months of 2010 and we expect this trend to continue as the global recovery in trade volumes gains momentum, said the ratings agency.

Moody’s said it also takes comfort from the company’s strong liquidity position, with about $2.9 billion (Dh10.6bn) of cash available as of end-2009 and moderate maturities and capex requirements over the coming 12 months.

Should DP World’s operating environment continue to improve, while gradual settlement of Dubai World’s creditors results in greater stability at its parent company and enables viable Dubai-based corporations to return to the debt and capital markets, DP World’s ratings could face further upside over time, it said.

DP World ranks among the world’s four largest container terminal operators by capacity and throughput. 
— issacjohn@khalejtimes.