AD Ports Group is celebrating record third quarter net profit growth after strong growth in its Maritime Cluster and a robust performance of its Economic Cities & Free Zones (EC&FZ) Cluster.
The global trade, logistics and transport operator’s revenue grew 53% YoY to AED 1.4 billion in Q3 2022 (+35% YoY growth to AED 3.7 billion in the first nine months of the year).
In addition to its maritime and free zone boosted activity, revenue in its ports operation grew 18% YoY on a like-for-like basis when adjusted for the positive effect of a one-off sand supply contract in 2021.
Net profit ‘soared’ 77% YoY to reach AED 334 million in Q3 2022, reported AD Ports Group.
The group added that it continued to press ahead with its ambitious organic revenue generating CapEx programme, with spending of AED 1.6 billion in Q3 2022 for a running total of AED 4.2 billion in 2022.
The expansion of ADT and CSP Abu Dhabi Terminals in 2021 has enabled it to maintain momentum at its ports. The group has a solid financial position and robust balance sheet, with significant capital resources available for both organic and inorganic growth, added the firm, noting that container volumes grew 31% YoY in Q3 2022 (and 28% overall in 2022).
One of the key highlights of the period was the announcement of the acquisition of an 80% equity stake in Dubai-based Global Feeder Shipping (GFS), a global container shipping company. GFS is the third largest feeder shipping business globally, with operated capacity of 72,500 TEUs, a total of 26 vessels, and 9,000 owned and 31,000 operated containers across its feeder and NVOCC businesses. It operates a comprehensive service network of 20 services across the GCC, Red Sea, Indian Subcontinent and Southeast Asia.
Upon completion, the acquisition, which is the company’s largest by AD Ports Group to date, is set to position AD Ports Group as the largest pure feeder operator in the region and the third largest globally by container capacity, which will be close to 100,000 TEUs. GFS provides a complementary asset base and portfolio of services that will boost AD Ports Group’s regional and global footprint, it said.
In September, AD Ports Group also completed the acquisition of a 70% stake in International Associated Cargo Carrier (IACC) in Egypt, which fully owns Transmar and TCI, for an enterprise value of AED 514 million (USD 140 million).
These acquisitions have boosted the performance of the Group’s Maritime Cluster, which saw a 241% YoY increase in revenue to AED 1.3 billion in the first nine months of the year.
This was in part driven by increased activity in new business segments and service offerings, including feedering, chartering, transshipment, and offshore services, and accelerated by the contribution of the recent acquisitions, including Divetech, ASCL, SAFEEN Surveys and Subsea Services, and Transmar, which accounted for 27% of the total 9M 2022 Maritime Cluster revenue, explained its reporting statement.
“These remarkable results demonstrate the effectiveness and impact of our ambitious growth strategy, as we seek new opportunities even in challenging global market conditions. As ever, we are grateful to our wise leadership for their steadfast support for our initiatives at home in the UAE and around the world,” said Captain Mohamed Juma Al Shamisi, managing director and group CEO, AD Ports Group.
“We have pursued joint ventures and acquisitions that have built supply chain density along major routes, accelerating trade and building resilience for customers around the world. These new ventures have played a key role in expanding our service offering, enabling us to support customers at every stage of their business journey, and delivering exponential growth in our maritime business in particular.”
Martin Aarup, group chief financial officer, AD Ports Group, added: “We have a strong balance sheet, a firm bedrock of long-term recurring revenue for our Ports and EC&FZ businesses, and we see a positive correlation between the fundamentals of the Abu Dhabi economy and the success of our business. Our alignment with the emirate’s long-term industrial and manufacturing strategies, the upcoming launch of Etihad Rail freight services in 2023, the country’s National Food Security Strategy 2051, and the long-term strategy to diversify the economy and boost non-oil exports all auger well for our business in the future.”
Ross Thompson, Group Chief Strategy and Growth Officer, AD Ports Group, said that despite signs of economic recession and a slowing of international trade globally, its operations are thriving: “In markets and along routes that still show tremendous capacity for growth, particularly in the MENA region, along the Red Sea coast, and the Indian subcontinent.
“We are successfully executing a three-stage growth strategy with clear objectives and outcomes, consolidating our position as the leader in logistics and trade services in Abu Dhabi and the UAE; executing customer-led regional expansion along critical trade routes and through focused service launches; and expanding globally across major maritime and inland supply chains. We can offer confident medium-term visibility that will see positive strong revenue, EBITDA and profit growth for the next five years.”
