DP World delays Terminal 4 launch plans amid softening market
DP World has changed its port expansion plans amid a softening global shipping market, with the launch of Terminal 4 delayed until at least the second half of 2019.
Terminal 4, a fully automated container terminal at the port operator’s flagship Jebel Ali Port, will instead be used for spill-over cargo as DP World undertakes a redevelopment of Terminal 1.
“Whilst the intention was that this (Terminal 4) was supposed to take in new cargo, given the current slowdown in the market place, we will use this opportunity to refurbish Terminal 1 … and move some of the cargo to Terminal 4,” said Yuvraj Narayan, DP World Group’s chief financial officer.
The ports operator said the terminal is essentially ready for operations and has more cost efficiencies than Terminal 1, which makes it ideal for buffer capacity while Terminal 1 is upgraded.
Narayan made these comment at a press conference held by DP World to announce its annual financial results.
The operator said that acquisitions helped it “weather the storm” of trade tensions in 2018, with the group achieving a 10.2% increase in net profit for 2018.
Sultan Bin Sulayem, DP World Group chairman and chief executive officer, has previously warned that trade tensions between China and the US, and a general slowdown in China, were going to impact trade volumes.
That cautious outlook was repeated at the press conference.
“Current year has started with trading in line with expectations and whilst the near-term outlook remains uncertain with the trade war and geopolitical headwinds, we expect our portfolio to remain resilient and see increased contributions from our recent acquisitions and investments,” he said.
DP World saw US $1.3 billion (AED4.77 billion) in profit for the year attributable to owners after separately disclosed items, compared to US $1.18 billion in 2017.