Volumes Decline for DP World Due to COVID-19
DP World Limited, one of the world’s largest operators of ports with locations in more than 50 countries, reported more than a five percent decline container volumes handed across its ports worldwide in the first quarter of 2020. Even adjusting the numbers to reflect ports it had in operator in the year-ago period, the results reflected a nearly four percent decline in volume.
Reflecting a similar trend to most ports impacted by the spread of COVID-19, DP World reported a nearly eight percent decline in volumes during the second quarter of 2020. In total, in the firsts half of 2020, DP World’s port operations handled 33.9 million TEUs.
“Like most industries, the maritime and logistics sector is going through an unprecedented and challenging period due to the COVID-19 outbreak,” commented Group Chairman and Chief Executive Officer Sultan Ahmed Bin Sulayem. He pointed out, however, that the resulted compared favorably against an estimated industry decline of approximately 15 percent in the second quarter and a 10 percent decline industry-wide for the first half of 2020 according to Drewry
DP World pointed out that all of its ports had maintained operations keeping cargo flowing and managing in the difficult worldwide conditions. The company investments in digital technology and automation were also credited as helping to ensure minimal disruption at the locations.
The Group Chairman reported that while the outlook is still uncertain, the company remains positive on the medium to long-term fundamentals of the industry. Furthermore, DP’s strategy of providing integrated supply chain solutions to beneficial cargo owners they believe positions the company to benefit from any sustained recovery in the global economy.
Continuing its strategy of acquisitions to enhance its global operations, DP World separately announced that it has agreed to acquire a 60 percent stake in UNICO Logistics Co. Ltd. one of the largest independent NVOCC (Non-Vessel Operating Common Carrier) in South Korea with operations in 20 countries. UNICO is a multimodal transport specialist positioned in the fast-growing transcontinental rail freight market between East-Asia and Central-Asia and Russia. This includes operations on the Trans-Siberian Railway (TSR) and Trans China Railway (TCR).
"DP World's vision is to become the leading end-to-end supply chain solutions provider. By integrating Unico into our worldwide network we will be able to offer better service to our customers in South Korea and beyond,” commented Sultan Ahmed Bin Sulayem. “These new services further strengthen our logistics capabilities, which we are combining with our maritime services operations and our worldwide network of ports and terminals."
The transaction, subject to regulatory clearances, is expected to close in the fourth quarter of 2020.