The logistics firm said the broadening of strategic partnerships and monetisations of its assets in 2022 strengthened its balance sheet
Dubai’s DP World, one of the biggest global port operators, said its revenues surged by nearly 60 per cent to $17.1m (Dhs62.9bn) in 2022 from Dhs23.3bn a year earlier. The rise was driven by acquisitions and the solid performance of its ports and terminals, and marine services.
The port operator’s containerised revenue increased by 12.1 per cent due to the increased demand for ancillary container services.
Like-for-like non-containerised revenue also jumped by 18.3 per cent, with a strong performance from ‘Unifeeder’.
DP World’s recorded adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) of Dhs18.4bn, a 31 per cent increase owing to strong revenue growth, which reflects a margin of 29.3 per cent.
DP World announces record results with adjusted EBITDA of AED18,41 billion.#WamNews https://t.co/kY2uHHKVEA
— WAM English (@WAMNEWS_ENG) March 16, 2023
The company said the broadening of strategic partnerships and monetisations of assets in 2022 strengthened its balance sheet and provided long-term flexibility, with more than Dhs29.4bn raised from the selling of stakes in key assets in the UAE.
“In 2022, we focused on strengthening the balance sheet and raised over Dhs29.4bn billion through asset monetisations.
“This programme and new partnerships will allow us to continue to drive growth in our portfolio,” said Sultan Ahmed bin Sulayem, DP World group chairman and CEO.
The fresh capital generated from asset monetisations provides the capacity and flexibility to invest in key growth markets while maintaining an investment-grade rating, said DP World.
The ports and logistics giant is rated Baa2 and BBB- by Moody’s and Fitch Ratings, respectively. Moody’s’ stable outlook and Fitch’s positive outlook reflect the firm’s improved financial performance and a stronger balance sheet.
“Our continued focus on high-margin cargo and end-to-end supply chain solutions is the key driver of these results, and we believe this strategy will continue to yield sustainable returns over the long term,” added Sulayem.
DP World monetise assets
Meanwhile, DP World has been exploring the sale of equity stakes in certain assets as it seeks to enhance its business operations and capture the significant growth potential of the wider region.
The Canadian pension fund, Caisse de Depot et Placement du Quebec, agreed to invest Dhs18.4bn in the company’s UAE assets in June 2022 for a 22 per cent stake in Jebel Ali Port, Jebel Ali Free Zone and the National Industries Park.
Saudi Arabia’s Hassana Investment Company (Hassana) also took a 10.2 per cent stake in DP World’s assets including the Jebel Ali Port and National Industries Park last December, a deal that is expected to transform Dubai into a global trading hub.
The investment by Hassana, the investment manager for Saudi Arabia’s General Organization for Social Insurance, which owns one of the world’s largest pension funds, implies a total enterprise value of about $23bn for DP World’s three assets.
These assets generated pro-forma revenue of $1.9bn last year.
The expansion of the National Investment and Infrastructure Fund India partnership and the creation of new alliances with the UK’s development arm British International Investment raised around Dhs2.2bn.
DP World plans to spend around Dhs6.24bn in 2023 and the capital will be invested in the UAE, Saudi Arabia, the UK, Senegal, the Democratic Republic of the Congo, Peru and South Africa.
The ports giant aims to deliver supply chain solutions to cargo owners by leveraging its best-in-class infrastructure across logistics, ports and terminals, marine services and digital.
The company is investing Dhs1.83bn to reduce carbon emissions by 700,000 tonnes over the next five years in line with the UAE 2050 Initiative as decarbonisation remains a core focus.
Dubai took DP World private in early 2020 to help the company better manage its borrowings