DP World profits surge 122pc

Original Article

DUBAI - DP World said on Thursday business was accelerating in the second half, as emerging markets trade mitigated a global economic downturn, after first-half profit more than doubled, boosting shares.

Still, the shipping industry has reported early indications of weakening growth in some markets, the world’s fourth-largest container port operator said.

“In the last few months there are indications of weakening growth in some markets, but we continue to outperform... and expect 2008 to be in line with expectations,” Chief Executive Mohammed Sharaf told reporters in Dubai.

DP World said first-half profit from continuing operations after tax rose to $287 million, up 122 per cent from the year earlier.

That exceeds a forecast for a headline net profit figure of $277 million, according to a Reuters poll. Merrill Lynch said in a July note that it expected DP World’s net income this year after deducting minorities to be $499 million.

Analysts said the results could buoy shares, which have slumped 34 per cent so far this year on concerns of a global economic downturn.

The stock was up five per cent to $0.84 at 1040GMT on the Dubai International Financial Exchange, still well below its initial public offering price of $1.30.

Sharaf ruled outanyimmediateplans tobuybackshares. Shareholders approved a buyback option in May. Continued growth: Despite the slowdown in Asia, where 70 per cent of the group’s portfolio is focused, Sharaf said he expected growth to continue in 2009.

The port operator said capacity at the 25 consolidated terminals majority owned or operated rose to 21 per cent to 13.6 million 20-foot equivalent units (TEU) in the first half of the year compared with the same period in 2007. Volumes for all 45 terminals rose 13 per cent to 23 million TEUs, it said. The operator aims to double capacity by 2013 excluding acquisitions.