P&O Ferries owner posts £500m profit but CEO warns of ‘uncertain’ trade outlook
P&O Ferries owner DP World posted half-year profits of $651m (£509.18m) today, down 10 per cent on last year’s record performance, amid a more challenging outlook for global trade and weakened freight rates.
“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 steady set of full-year results,” the Dubai-based port operator’s chief executive, Sultan Ahmed Bin Sulayem, said.
Sulayem noted that a slowdown in trade growth throughout 2023 had led to a “marginal decline in container volumes, as consumers tightened their belts”.
A cooling of freight rates to pre-Covid levels had also hit the firm – which is owned by the state-run company Dubai World – and resulted in “weaker growth for logistics,” he added.
Despite this, DP World saw revenues jump 13.9 per cent year-on-year to $9bn, driven by a strong performance from its Imperial Logistics business in Africa and its shipbuilding and repair segment, Drydocks World, in the UAE.
Adjusted Ebitda grew 7.0 per cent to $2.6bn, with an adjusted Ebitda margin of 28.9 per cent.
DP World’s results fall against a difficult backdrop for global trade and the shipping sector, which is grappling with a slowdown in economic growth, inflation, interest rate hikes and geopolitical tensions caused by the war in Ukraine.
World trade growth is expected to decline to two per cent in 2023, from 5.2 per cent in 2022, according to the International Monetary Fund.
Tanker and dry-bulk shipping companies have also struggled as geopolitical tension, primarily stemming from Vladimir Putin’s invasion of Ukraine, disrupts maritime trade and import routes.