TIDMDPW
RNS Number : 3092A
DP World Limited
29 March 2012
DP WORLD LIMITED ANNOUNCES STRONG PRELIMINARY RESULTS
For the twelve months ended 31 December 2011
Reported Results (A) 2011 2010 % change Underlying change (C)
before separately disclosed items unless stated (B)
USD million
Gross[1] throughput (TEU '000) 54,737 49,588 10% -
Consolidated[2] throughput (TEU '000) 27,471 27,750 -1% 9%
Revenue 2,978 3,078 -3% 14%
Adjusted EBITDA[3] 1,307 1,240 5% 19%
Adjusted EBITDA margin 43.9% 40.3% - 42.1%
Profit for the year 532 450 18% 24%
Profit for the year attributable to owners of the Company 459 374 23% -
Profit for the year
after separately disclosed items (D) 751 451 67% -
Profit for the year attributable to owners of the Company
after separately disclosed items 683 375 82% -
Earnings per Share (US cents)
after separately disclosed items 82 cents 45 cents 82% -
Dividend per Share (US cents) 24 cents 17 cents[4] -
A. Reported results before separately disclosed items include revenue for the Australia terminals
until 11 March 2011 and share of profit from equity-accounted investees from those terminals
from 12 March 2011.
B. Before separately disclosed items primarily excludes non-recurring items. Further details
can be found in Note 11 of the audited accounts.
C. The underlying change shows what growth rates and margin would have been had the five terminals
in Australia continued to be consolidated in DP World's accounts from 12 March 2011 and allows
for a better comparison to the prior period.
D. The statutory results include separately disclosed items. Further details can be found
in Note 11 of the audited accounts.
----------------------------------------------------------------------------------------------------------------------
Dubai, United Arab Emirates, 29 March, 2012: DP World today
announces strong financial results from its global portfolio of
marine terminals for the twelve months to 31 December 2011,
delivering a better than expected profit attributable to owners of
the Company before separately disclosed items of $459 million, 23 %
ahead of last year.
Adjusted EBITDA3 was $1,307 million with adjusted EBITDA margin
of 43.9%. When compared with the prior year, underlying[5] adjusted
EBITDA growth was 19%, ahead of underlying revenue growth of 14%
and underlying container volume growth of 9%. We have delivered a
sustainable improvement in underlying container revenue per TEU of
5%, increased underlying non-container revenue by 11% and delivered
a reduction in our underlying cost per TEU following productivity
improvements in parallel with our ongoing discipline around
costs.
Each of our three regions has delivered a superior performance
when compared with the prior year. In the Middle East, Europe and
Africa region, adjusted EBITDA grew 9% to $861 million, with an
adjusted EBITDA margin of 45.7%. In the Asia Pacific & Indian
Subcontinent region, adjusted EBITDA increased 26% to $322 million
with a significantly improved adjusted EBITDA margin of 64.5%. The
Americas and Australia region delivered adjusted EBITDA of $203
million or, excluding the deconsolidation of the five Australia
terminals, on an underlying basis, delivered adjusted EBITDA growth
of 37% and improved adjusted EBITDA margins of 33.1%.
Profit attributable to owners of the Company after separately
disclosed items was $683 million. This delivered earnings per share
(EPS) of 82 cents, considerably ahead of the prior year EPS of 45
cents, due to separately disclosed items[6] increasing profit by
$225 million.
With strong conversion of profitability into cash, gross cash
flow from operations increased to $1,159 million with net debt
reduced to $3,583 million. This was partly as a result of our
improved financial performance and partly due to the proceeds from
the monetisation of 75% of our Australian terminals. This results
in leverage (net debt to adjusted EBITDA) of 2.7 times and provides
a solid platform for investing in the future growth of our
operations.
We continue to invest in our operations to ensure that DP World
is well positioned to take advantage of the growth in global trade
and meet the requirements of our customers. During 2011 we
completed and opened major capacity expansion projects in Dakar
(Senegal) and Karachi (Pakistan) and opened a new terminal at
Vallarpadam (India). Despite these new capacity additions,
utilisation remains high, above 80% across our portfolio. High
utilisation in Jebel Ali (UAE) is why we will be investing in an
additional 1 million TEU of new capacity in 2012 and investing in a
new 4 million TEU container terminal which will be operational in
2014. In addition, we have announced that London Gateway (UK) will
be operational in the final quarter of 2013.
DP World Group Chairman, Sultan Ahmed bin Sulayem commented;
"DP World delivered an excellent improvement in profitability
during 2011 reporting profit for the year before separately
disclosed items of $532 million. This improvement in profitability
is a reflection of our strategy, which sees us focus on the faster
growing emerging markets and more profitable origin and destination
and gateway cargo. This is also a reflection of our ability to meet
our customers' needs for the right capacity in the right locations
and deliver a world class efficient service to ensure we are the
port operator of choice around the world.
"Since the decline in global container volumes in 2009, DP World
has worked hard to build a more robust and profitable portfolio. We
have also continued to invest in our business through the downturn.
Our 2011 results reflect this, with a 55% improvement in profit
attributable to owners of the Company before separately disclosed
items since 2009, as our investments in new terminals mature and we
benefit from the inherent operating leverage of our portfolio.
"On account of this strong improvement in underlying profit
combined with the additional profit from the Australia
monetisation, the Board of DP World is recommending an increased
dividend distribution to $199 million, or 24 US cents per share.
The Board is confident of the Company's ability to continue to
generate cash and support our future growth whilst maintaining a
stable dividend payout."
DP World Group Chief Executive, Mohammed Sharaf commented;
"2011 has been another good year for DP World with the second
half of the year delivering a better performance than the first
half. This improved performance was achieved despite a
deteriorating global economic backdrop in the second half.
"We have benefited from the improvement in global container
volumes whilst retaining a very clear focus on generating
additional revenue, driving productivity and upholding a
disciplined approach to cost management. This has resulted in an
adjusted EBITDA3 of $1,307 million and adjusted EBITDA margin ahead
of expectations at a record 43.9%.
"We have seen commendable growth throughout our global portfolio
and our flagship terminal Jebel Ali (UAE) continues to deliver
sustainable EBITDA growth. We have supplemented this solid domestic
performance with stronger growth in major terminals outside the UAE
as we continue to invest in our portfolio of growth oriented
terminals.
"The global macroeconomic uncertainty has continued into 2012.
With our portfolio focused on the faster growing emerging markets
and more stable O&D markets, we continue to see growth across
our portfolio in the first two months of the year, with an 11%
improvement in gross volume growth. We remain committed to
delivering improved operational and financial performance over
2011.
"As we look ahead, we remain confident about the long term
outlook for our industry. We believe our continued investment in
existing and new terminals around the world will ensure our
portfolio is best positioned to meet the expectations of our
customers and should allow us to continue to outperform."
The Chairman's Statement, Operating and Financial Review and
Financial Statements follow from page 4.
Investor Inquiries
Fiona Piper Jasmine Lindsay
DP World Limited DP World Limited
Dubai Mobile: +971561778731 Direct: +97148080812
UK Mobile: +447919175602 Mobile: +971504220405
Email: Fiona.piper@dpworld.com Email: jasmine.lindsay@dpworld.com
Analyst and Investor Meeting in Dubai, UAE and Global Conference
Calls
There will be a meeting in Dubai and conference calls for debt
and equity analysts and investors;
1) Meeting for analysts and investors in Dubai, UAE at 1200 noon
on Thursday 29 March at DIFC Conference Centre, The Gate Building
4
2) Conference Call at 1200 noon Dubai time (0900 London) on
Thursday 29 March 2012 with CEO Mohammed Sharaf and CFO Yuvraj
Narayan
3) Conference Call at 1600 Dubai time (1300 London, 0800 New
York) on Thursday 29 March 2012 with CFO Yuvraj Narayan
4) A playback of the call will be available shortly after the 12
noon conference call concludes. For the dial in details and
playback details please contact investor.relations@dpworld.com.
The presentation accompanying these conference calls will be
available on DP World's website within the investor centre.
www.dpworld.com from 0900 UAE time this morning.
Chairman's Statement
2011 has been another good year for DP World, delivering a
better than expected improvement in profit attributable to owners
of the Company, before separately disclosed items, of $459 million,
23 % ahead of last year.
This improvement in profitability is a reflection of our
strategy which sees us focus on the faster growing emerging markets
and more profitable origin and destination cargo, meeting our
customers' needs for the right capacity in the right locations and
delivering a world class service to our customers to ensure we are
the port operator of choice around the world.
Since the decline in global container volumes in 2009, DP World
has worked hard to build a more robust and profitable portfolio. We
have continued to invest in our business through the downturn
creating a balanced global portfolio of cash generative assets.
Each terminal is managed locally, to better identify and take
advantage of the unique growth opportunities of the local market,
with the added value of operational leverage and synergies that
come from being part of a global network. Over the last three
years, DP World has invested in creating 25% more capacity in new
and existing terminal operations, primarily in the faster growing
emerging markets.
Since 2009 we have achieved adjusted EBITDA[7] growth of 22% and
an improvement in adjusted EBITDA margins from 38% to 43.9% despite
a deceleration of the global economy. This has delivered a 55%
improvement in profit attributable to owners of the Company before
separately disclosed items, as our investments in new terminals
mature and we benefit from the inherent operating leverage of our
portfolio.
Strategy
DP World's strategy is to create, develop and manage the most
efficient, safe and secure methods of directing the flow of goods
through the critical gateways that drive world trade. Underpinning
our strategy is our focus on delivering profitable and sustainable
growth for the owners of the Company through incremental revenue
generation, improved logistical and operational efficiencies and
cost management driving cash flow and returns.
Our continuing focus is to ensure that our business is well
prepared to respond to the immediate needs of our customers,
whether that is in reliability, additional capacity at existing
ports, reducing turnaround time of vessels or improving the speed
of evacuation of containers from the port. Productivity
improvements have been one of the highlights of 2011 with many
terminals significantly improving productivity, which in turn
further improves DP World customer loyalty and EBITDA margins.
Ours is a long-term industry where concessions are in excess of
30 years and our key top line driver of global trade is expected to
continue growing. As shipping lines plan for the future with larger
vessels and new trading routes, port operators must follow
suit.
Our industry continues to see a shortage of the right capacity
in the right locations to meet the medium term needs of our
customers. Port operators need to plan ahead to ensure that
capacity is available to match changing trends in outsourcing of
manufacturing, emerging consumer demand growth and to handle the
increasing size of container vessels on order today. DP World is
focused on delivering the right capacity in the right locations, in
line with market demand, through the expansion of existing
terminals within our portfolio, or developing new terminals. In
2011, we added over 5 million TEU of additional capacity through
new developments and expansions of existing terminals including in
India, Africa and China. Our new port in Vallarpadam (India) opened
early in the year and has recently handled the largest vessel ever
to call in India.
Our customers are looking for continual improvements in
efficiency as containers are moved on larger vessels to take
advantage of economies of scale - the more efficient the port, the
quicker the turnaround time of the vessel. Integral to our strategy
is investing capital to improve efficiencies around loading and
unloading of vessels including new quay cranes. During 2011 DP
World has achieved many new productivity records, including record
berth moves per hour in Antwerp (Belgium), Doraleh (Djibouti),
Jebel Ali (UAE), Karachi (Pakistan), Mundra (India), and
Southampton (UK).
Shipping lines and shippers alike are seeking greater
efficiencies across the whole supply chain to improve their
competitiveness in the marketplace. DP World is seeking to smooth
the transport of containers to and from our ports through 'beyond
the gate' activities. We have invested in a container train to
improve connectivity between the ports and hinterland in the Indian
Subcontinent region; we operate a container freight station outside
the port gates in Mundra (India) and we have invested in and
operate inland depots in Northern Europe and Vancouver
(Canada).
Our core business is handling containers and we expect to
maintain approximately 80% of our revenues from container related
activities. We also remain focused on terminals that are located in
origin and destination and gateway markets with approximately 75%
of our volumes coming from the faster growing emerging and frontier
markets. This combination provides us with more stable revenue and
cash flow, higher EBITDA margins and provides more resilience
during challenging macroeconomic times.
Financial Strategy
DP World's financial policy is to maintain a strong capital base
so as to maintain investor, creditor and market confidence and to
sustain the future development of the business.
We have a strong balance sheet which provides us with the
flexibility to support growth in our existing business, expand
capacity in line with market demand and to maximise shareholder
value. We seek to maintain a balance between the higher returns
that might be possible with higher levels of borrowings and the
advantages and security afforded by a sound capital position.
The balance sheet is actively managed in line with the long-term
nature of our global operations and is best suited to a combination
of funding through cash flow from operations, long-term debt at the
corporate level and project finance at the individual terminal
level. We believe that this should be achieved without leverage
(net debt to adjusted EBITDA) exceeding 4 times in the current
market environment.
DP World delivered strong cash performance during 2011. Gross
cash from operations increased by 5% to $1,159 million and funded
capital expenditure of $481 million. This strong cash flow, coupled
with the proceeds of the monetisation in Australia, which has been
held as cash for the majority of 2011, resulted in a significant
reduction of net debt to $3,583 million.
Investment in our Portfolio
Long-term trade growth is forecast to continue and, with larger
vessels joining the world fleet, port capacity today remains under
pressure with high utilisation rates in some markets and low levels
of productivity and efficiency in other markets.
In line with our strategy, DP World is focused on investing for
the long-term capacity requirements of our customers, whether it is
in developed markets which do not have the efficiencies or
capabilities to handle the increasing size of vessels, or in
developing markets which have limited container port capacity to
meet their growing needs.
During 2011 we added 5.3 million TEU to our global portfolio
with major expansion projects at existing terminals Dakar
(Senegal), Karachi (Pakistan) and Qingdao (China) as well as
opening a new development in Vallarpadam (India). Despite the new
capacity additions, utilisation remains high, above 80% across our
portfolio.
During the year we took two very important decisions relating to
new capacity. In October, we announced London Gateway (UK) will
open in the final quarter of 2013. London Gateway, surrounded by a
logistics park, will be the closest deep water port to London and
the South East, the largest consumer market in the UK. London
Gateway will be capable of handling the world's largest vessels and
will have very high levels of productivity delivering a unique
service to our customers.
In December, we announced the development of a new terminal in
Jebel Ali (UAE) to be operational in 2014. This is in addition to a
1 million TEU expansion of Jebel Ali's Terminal 2. In 2011, Jebel
Ali (UAE) grew volumes by 12% as it further cemented its position
as a leading hub for trading in the Middle East, India and Africa.
The port is now operating at very high levels of utilisation and
with current forecasts continuing to show strong growth across the
region, additional capacity will be needed if we are to meet the
increasing needs of our customers.
Over the last five years we have invested in capacity for an
additional 24 million TEU around the world. When taking into
account our pipeline of new developments and major expansions,
which will be rolled out in line with market demand, by 2020 we
anticipate having global capacity handling in excess of 100 million
TEU. We continue to see further opportunities to expand our
existing terminal facilities through incremental capacity growth as
well as adding new concessions in new locations.
Dual Listing
On 1 June 2011, DP World Limited was admitted to the Official
List of the UK Listing Authority and to trading on the London Stock
Exchange's main market for listed securities. There was no new
capital raised as part of the listing on the London Stock Exchange.
The aim was to provide an additional platform to invest in DP World
shares to help attract a broader range of investors, which we are
pleased to say we have achieved despite the challenging stock
market backdrop since the listing.
DP World shares now trade on both Nasdaq Dubai and the London
Stock Exchange with the shares being fully fungible across both
exchanges.
Dividend
The Board is recommending a full year dividend of 24 US cents
per share (2010: 17 US cents per share[8]). This comprises an
increase of 10% in the underlying dividend to 18.7 US cents per
share, supplemented by a special dividend of 5.3 US cents per share
reflecting the separately disclosed profit attributable to owners
of the Company[9]. This will result in a total dividend
distribution of $199 million reflecting continued confidence in our
ability to generate cash and support our growth plans whilst
maintaining a stable dividend payout.
Subject to approval by shareholders, the dividend will be paid
on Wednesday 2 May 2012 to shareholders on the relevant register as
at the close of business on 10 April 2012.
Outlook Statement
The global macroeconomic uncertainty has continued into 2012.
With our portfolio focused on the faster growing emerging markets
and more stable O&D markets, we continue to see growth across
our portfolio in the first two months of the year, with an 11%
improvement in gross volume growth. We remain committed to
delivering improved operational and financial performance over
2011.
As we look ahead, we remain confident about the long term
outlook for our industry. We believe our continued investment in
existing and new terminals around the world will ensure our
portfolio is best positioned to meet the expectations of our
customers and should allow us to continue to outperform.
Sultan Ahmed Bin Sulayem
Chairman
Review of Operational and Financial Results
On 11 March 2011, DP World and Citi Infrastructure Investors
(CII), together with one of CII's major investors, formed a
strategic partnership to invest in DP World's five container
terminals in Australia. DP World continues to operate and manage
the five marine terminals. The strategic partnership saw DP World
monetise 75% of its shares whilst retaining a 25% shareholding in
the new joint venture.
For the purpose of 2011 financial reporting, our ports in
Australia are included, as in previous years, in the Australia and
Americas region, with all five container ports consolidated until
11 March 2011. From 12 March 2011, the five ports are no longer
consolidated in our accounts and are accounted for within
equity-accounted investees.
Our revenue has benefited from the inclusion of a full twelve
months of revenues from Callao (Peru) which opened at the end of
the first half of 2010, and the inclusion of Paramaribo (Suriname)
which joined the portfolio in August 2011, offset by the exclusion
of revenue from our five terminals in Australia since 12 March
2011.
Our share of profit from equity-accounted investees has
benefitted from the inclusion of our five terminals in Australia
since 12 March 2011, offset by the exclusion of profit from P&O
Trans Australia (POTA) since April 2011 and Marseille (France)
since July 2011.
As a global business, we are exposed to currency translation on
our reported results. Over the period, the strengthening US dollar
had a positive impact on reported adjusted EBITDA.
USD million 2011 2010 % change Underlying
before separately disclosed change (C)
items
Full details on page x onwards
Consolidated[10] Throughput
(TEU '000) 27,471 27,750 -1% 9%
Revenue 2,978 3,078 -3% 14%
Share of profit from equity-accounted
investees 142 140 1% 9%
Adjusted EBITDA [11] 1,307 1,240 5% 19%
Adjusted EBITDA Margin 43.9% 40.3% - 42.1%
Profit for the year 532 450 18% 24%
Profit for the year attributable
to owners of the Company 459 374 23% -
C.The underlying change shows what growth rates and margin
would have been had the five terminals in Australia continued
to be consolidated in DP World's accounts from 12 March 2011
and allows for a better comparison to the prior period.
----------------------------------------------------------------------------------
Revenue for our consolidated terminals([10]) in 2011 was $2,978
million. Containerised revenue accounted for 79% of our total
revenue and was $2,355 million for the year. Non-container revenue
was $623 million and accounted for 21% of total revenue.
Had the five terminals in Australia not been deconsolidated from
12 March 2011, underlying[12] revenue growth would have been 14% as
underlying volume growth of 9% was supported by a 5% increase in
underlying container revenue per TEU from a positive pricing
environment and additional ancillary revenue. Underlying
non-container revenue increased 11%.
We continue to keep a tight control on our costs and have worked
hard to move fixed costs to variable costs over the past three
years with 64% of our total costs now variable. In 2011, our
underlying[13] costs increased 10%, while our underlying revenue
increased 14%, reflecting this continued focus on cost management.
In addition, we continue to focus on improving terminal
efficiencies so that we can handle more containers for the same or
lower cost. In 2011 our underlying cost per TEU at constant
currency decreased by 1%.
Our portfolio of terminals accounted for as equity-accounted
investees has reported a share of profit of $142 million. Whilst
many of our terminals in this portfolio have reported strong growth
during 2011, this was offset by the exclusion of a share of profit
from POTA which was divested early in 2011.
Adjusted EBITDA increased 5% to $1,307 million with an improved
adjusted EBITDA margin of 43.9% from 40.3% in the prior year.
Whilst the deconsolidation of the Australian terminals enhanced our
adjusted EBITDA margin, excluding the positive benefit from this,
underlying adjusted EBITDA margins still improved to 42.1%. This
adjusted EBITDA margin improvement - slightly ahead of our
expectations, is driven by a combination of better revenue
generation than expected, improved utilisation to 82% and a
successful reduction in cost per TEU.
Like for like container revenue[14] at constant currency grew
10%, ahead of volume growth of 8%, with container revenue per TEU
increasing 2% to $92 as our terminals were able to push through
tariff increases and attract more revenue for additional ancillary
services. Like for like adjusted EBITDA at constant currency grew
14% with like for like adjusted EBITDA margins at constant currency
of 42.1% following a 2% reduction in cost per TEU.
Profit for the year before separately disclosed items of $532
million is 18% ahead of the prior year on account of the higher
adjusted EBITDA and lower depreciation and amortisation due to the
Australian terminals no longer being included from 12 March 2011.
Profit attributable to owners of the Company after separately
disclosed items was $683 million with earnings per share of USD 82
cents.
During the year, we have continued to invest in our operations
with capital expenditure of $481 million. Almost 80% of this
capital expenditure was invested in the Europe, Middle East and
Africa region, primarily London Gateway (UK), Southampton (UK) and
Dakar (Senegal).
Review of Regional Trading
Europe, Middle East and Africa
USD million 2011 2010 % Change
before separately disclosed
items
Consolidated[15] throughput
(TEU '000) 19,110 17,503 9%
Revenue 1,884 1,742 8%
Share of profit from equity-accounted
investees 14 10 48%
Adjusted EBITDA[16] 861 793 9%
Adjusted EBITDA Margin 45.7% 45.5%
--------------------------------------- ------- ------- ---------
The strong results in 2011 in the Europe, Middle East and Africa
region have been partially offset by the weaker performance in the
Middle East (excluding UAE) as we have continued to see a
challenging operating environment following the political unrest in
the region. That said, the Middle East region worked hard to
mitigate a greater decline in performance and we have seen an
improvement in the second half of the year in both the Middle East
and the region as a whole. There has been focused attention on cost
management and improved productivity with notable new productivity
records achieved in Southampton (UK) and in Jebel Ali (UAE) during
the year.
Terminals that contributed to revenue for the region reported an
increase to $1,884 million. Container revenue accounted for 78% and
was $1,470 million for the year. Non-container revenue was $414
million and accounted for 22% of regional revenue.
This 8% increase in revenue to $1,884 million was driven by a 9%
increase in container volumes and slightly improved container
revenue per TEU to $77 as pricing improvements and additional
revenue from ancillary services were offset by a change in cargo
mix and lower volumes from the Middle East (excluding UAE).
Non-container revenue reported a small increase of 3% to $414
million as the 7% increase in the UAE region non-container cargo
was offset by lower non-container cargo in the Middle East
(excluding UAE) due to the unrest in the region.
Our share of profit from equity-accounted investees increased to
$14 million as we continued to see an improvement in the
performance of key equity-accounted investees in the Europe and
Africa region.
Adjusted EBITDA increased 9% to $861 million with improved
adjusted EBITDA margins of 45.7%. This improvement in adjusted
EBITDA is driven by improved revenue generation for container and
non-container operations, improved productivity and cost
management.
Favourable currency movements benefitted our reported results.
Like for like revenue growth at constant currency[17] was 7%,
driven by volume growth of 9% and container revenue growth of 8%.
Container revenue per TEU remained unchanged at $76 million due to
the mix of cargo being handled in the region. Like for like
non-container revenue at constant currency improved 2%. Like for
like adjusted EBITDA growth at constant currency was 8% with
adjusted EBITDA margin at 45.8% as cost per TEU was 2% lower than
the prior year.
The UAE reported an increase in container volumes of 12% to 13
million TEU in 2011, growing container revenue by 14% as additional
revenue came from both stevedoring and ancillary (storage)
activities. In addition, non-container revenue was slightly ahead
of expectations growing 7% as infrastructure projects continued
into the second half of the year driven by an increase in the
import of steel and aluminium.
During 2011, we invested $379 million across the Europe, Middle
East and Africa region with the majority invested in infrastructure
for London Gateway (UK) which we announced will open in the final
quarter of 2013. Southampton (UK) and Dakar (Senegal) both
benefitted from investment in new equipment to ensure they were
able to improve efficiencies in the terminals to benefit our
customers. Both terminals have subsequently won new customers and
achieved productivity milestones.
Asia Pacific and Indian Subcontinent
USD million 2011 2010 % Change
before separately disclosed
items
Consolidated[18] throughput
(TEU '000) 5,578 5,470 2%
Revenue 500 461 8%
Share of profit from equity-accounted
investees 117 96 23%
Adjusted EBITDA[19] 322 255 26%
Adjusted EBITDA Margin 64.5% 55.3%
--------------------------------------- ------ ------ ---------
The Asia Pacific and Indian Subcontinent region results were
positively impacted by the opening of our new terminal in
Vallarpadam (India), which replaced the old Cochin terminal, and
new expansion capacity in Karachi (Pakistan) and Qingdao (China).
The underlying business has also performed extremely strongly on
account of a significant focus on revenue generation and cost
management driving adjusted EBITDA margins to 64.5% from 55.3%.
Terminals that contributed to consolidated revenue for the
region experienced an increase in revenue to $500 million.
Container revenue accounted for 88% and was $442 million for the
year. Non-container revenue was $58 million and accounted for 12%
of regional revenue.
This 8% increase in revenue to $500 million was driven by a 2%
increase in container volumes and a 6% increase in container
revenue per TEU to $79. We saw a positive pricing environment
across the region and ancillary revenue growth primarily from
Karachi (Pakistan). Non-container revenue continued to report
strong growth of 22% to $58 million as the container rail business
in India continued to grow.
Our Asia Pacific and Indian Subcontinent region contributes the
majority of the share of profit from equity-accounted investees.
For the full year 2011, the region contributed $117 million, up 23%
from 2010. Whilst a key driver of this improvement was due to
additional capacity in Qingdao (China), we have continued to see
very strong growth across our portfolio of Asia Pacific terminals
and had considerable success driving revenue and managing the cost
base in 2011.
Adjusted EBITDA increased 26% to $322 million with improved
adjusted EBITDA margin of 64.5%. This improvement in adjusted
EBITDA is driven by improved revenue generation for container and
non-container operations, increased efficiencies and cost
management. In addition, adjusted EBITDA and adjusted EBITDA margin
benefitted from the 23% increase in our share of profit from
equity-accounted investees.
Excluding the contribution from new terminals and positive
currency movements, like for like revenue growth at constant
currency[20] was 10%, driven by an 8% growth in container revenue
as container volumes grew 2% and container revenue per TEU
increased 6% to $80. Like for like non-container revenue at
constant currency increased 23%. Like for like adjusted EBITDA at
constant currency increased 26% with an adjusted EBITDA margin at
63.3% as cost per TEU was 3% lower than the prior year.
$16 million of our capital expenditure was spent in the region
during the year, for the most part on maintenance capex, aside from
some investment in Vallarpadam (India) which opened at the
beginning of 2011.
Australia and Americas
On 11 March 2011, DP World and Citi Infrastructure Investors
(CII), together with one of CII's major investors, formed a
strategic partnership to invest in DP World's five container
terminals in Australia. DP World continues to operate and manage
the five marine terminals. The strategic partnership saw DP World
monetise 75% of its shares whilst retaining a 25% shareholding in
the new joint venture.
For the purposes of 2011 financial reporting, our terminals in
Australia are included, as in previous years, in the Australia and
Americas region with all five container ports consolidated until 11
March 2011. From 12 March 2011, the five terminals are no longer
consolidated in our accounts and are accounted for as
equity-accounted investees.
USD million 2011 2010 % Change Underlying
before separately disclosed change (c)
items
Consolidated throughput[21]
(TEU '000) 2,782 4,777 -42% 17%
Revenue 594 875 -32% 28%
Share of profit from equity-accounted * 40%
investees 10 35 * 71%
Adjusted EBITDA[22] 203 271 -25% 37%
Adjusted EBITDA Margin 34.2% 31.0% - 33.1%
C. The underlying change shows what growth rates and margin
would have been had the five terminals in Australia continued
to be consolidated in DP World's accounts from 12 March 2011
and allows for a better comparison to the prior period.
----------------------------------------------------------------------------------
The Australia and Americas region has continued to deliver
strong underlying growth over the prior year. The reported results
have been impacted by the deconsolidation of the five terminals in
Australia but mitigated by the additional revenue from Callao
(Peru), which contributed for the full period and strong growth in
non-container revenue led by Buenos Aires (Argentina) which saw an
increase in wheat exports and opened a new cruise terminal.
Revenue for our consolidated terminals in 2011 was $594 million.
Containerised revenue accounted for 75% of our total revenue and
was $443 million for the year. Non-container revenue was $151
million and accounted for 25% of total revenue.
Had our five terminals in Australia not been deconsolidated from
12 March 2011, underlying revenue growth would have been 28% higher
than the prior period, driven by an underlying volume growth of
17%. This volume growth was supported by a 9% increase in
underlying container revenue per TEU from a positive pricing
environment and additional ancillary revenue. Underlying
non-container revenue increased 32%.
Our reported share of profit from equity-accounted investees was
$10 million, lower than the same period last year as the inclusion
of new profit from our joint venture in Australia was offset by the
loss of profit from POTA. DP World sold its remaining shareholding
in P&O Trans Australia (POTA) on 17 April 2011.
Adjusted EBITDA was $203 million with adjusted EBITDA margin of
34.2%. Had the five terminals in Australia not been deconsolidated,
underlying adjusted EBITDA would have been 37% ahead of the prior
period and underlying adjusted EBITDA margin would have been 33.1%.
This increase in adjusted EBITDA was partly attributable to better
results across all our terminals in the region and the addition of
a full twelve months of Callao (Peru).
Like for like revenue[23] at constant currency grew 14% driven
by container revenue growth of 13% as volumes grew 9% and container
revenue per TEU increased 4% to $164 as our terminals were able to
push through tariff increases and attract more revenue for
ancillary services. Like for like at constant currency
non-container revenue increased 19%. Like for like adjusted EBITDA
at constant currency increased 19% with adjusted EBITDA margin of
32.4% and cost per TEU 1% lower than the prior year.
$84 million of our capital expenditure was spent in the region
primarily improving efficiencies at existing operations in the
Americas region and investing in a new cruise terminal in Buenos
Aires (Argentina) which has helped drive non-container revenues for
the region.
Depreciation and Amortisation
Depreciation and amortisation of $429 million is lower than the
prior year due to the terminals in the Australia region no longer
being included, mitigated by additional capacity joining the
portfolio in the Middle East, Europe and Africa and the Asia
Pacific and Indian Subcontinent regions.
Net finance costs
Net finance costs of $288 million (before separately disclosed
items) are slightly lower than expected as we held higher cash
balances for the duration of the year.
Higher finance costs of $423 million when compared to $368
million last year are due to slightly higher borrowing costs in
some of our subsidiary debt. This was offset by higher finance
income of $135 million when compared with $89 million last year as
our cash balances increased to $4,159 million from the proceeds of
the Australia transaction on 11 March 2011.
Interest cover (adjusted EBITDA and net finance costs) has
improved to 4.5 times from 4.4 times in 2010.
Taxation
DP World is not subject to income tax on its UAE operations. The
tax expense relates to the tax payable on the profit earned by
overseas subsidiaries, as adjusted in accordance with the taxation
laws and regulations of the countries in which they operate. For
2011, DP World's income tax expense was $59 million before
separately disclosed items.
In separately disclosed items, $7 million of income tax expense
has been included relating to the impairment of deferred tax assets
in the Middle East, Europe and Africa Region, offset by a tax
credit on the impairment of assets in the Australia and Americas
region.
The effective tax rate before separately disclosed items was
16.0%, a reduction from 16.7% last year as a result of the
deconsolidation of the five terminals in Australia.
Profit attributable to non-controlling interests (minority
interest)
Profit attributable to non-controlling interests (minority
interest) is slightly lower than the prior year at $73 million
reflecting the change in accounting at Sydney and Adelaide
(Australia) from 12 March 2011 when we stopped accounting for the
Australia terminals as consolidated terminals.
The key terminals where we have non-controlling interests are
Doraleh (Djibouti), Buenos Aries (Argentina), Karachi (Pakistan)
and Southampton (UK).
Separately disclosed items
In 2011, DP World had $219 million of separately disclosed
items. The $484 million profit on sale / termination of business
was primarily offset by $244 million impairment of assets.
The $484 million primarily relates to $436 million profit (net
of tax) on the monetisation of the Australian terminals and the
sale of our interest in POTA, an associate in the Americas and
Australia region resulting in a profit (net of tax) of $50
million.
The $244 million impairment of net assets in a subsidiary
includes $100 million in the Asia Pacific and Indian Subcontinent
region representing the difference between the value in use and the
carrying amount as at the reporting date primarily due to changes
in external factors outside the control of the Group. In addition
it includes $91 million of investments in equity accounted
investees classified as assets held for sale in the Middle East,
Europe and Africa region and impairment of property plant and
equipment in the Australia and Americas region and the Europe,
Middle East and Africa region of $30 million and $23 million
respectively.
The remaining separately disclosed items relate to a provision
of $3 million against deferred tax assets in an equity accounted
investee in the Middle East, Europe and Africa region, a loss of
$11 million on currency options and interest rate swaps relating to
the Americas and Australia region and $13 million of deferred tax
assets impaired in a subsidiary in the Middle East, Europe and
Africa region, which is offset by $6 million of tax credit on
impairment of assets in the Australia and Americas region.
Capital Expenditure
We have continued to adopt a flexible and discretionary approach
to our capital expenditure in 2011, investing $481 million over the
twelve month period.
Investment in new developments accounted for approximately 50%
of our total capital expenditure during the year with the majority
focused on our new development at London Gateway (UK) which will
open in the fourth quarter of
2013. Approximately 35% was invested in expansions at Sokhna (Egypt) and Dakar (Senegal).
Alongside these larger capital investment projects, additional
capital expenditure was focused on our existing portfolio to ensure
that our terminals are improving efficiencies and productivity or
investment in revenue generation and cost saving opportunities;
Southampton (UK), Jebel Ali (UAE) and CT3 (Hong Kong) all
benefitted from investment leading to improved productivity.
Balance Sheet
In 2011, total assets reduced to $18.8 billion as at 31 December
2011 and total equity reduced to $8.2 billion primarily related to
currency translation movement.
The group's investment in net assets of equity-accounted
investees as at 31 December 2011 remained flat at $3.5 billion with
the addition of the Australia operations mitigated by the sale of
our shares in POTA (Australia) and the joint venture that owns
Marseille (France). We invested an additional $12 million in
equity-accounted investees including Caucedo (Dominican Republic),
Embraport (Brazil) and Rotterdam (Netherlands).
Accounts receivable and pre-payments (non-current) have
increased to $260 million from $88 million in 2010. This increase
relates to long-term shareholder's loan to two of our
equity-accounted investees.
Bank and cash balances increased to $4.2 billion, an increase of
$1.6 billion mainly from the monetisation of our investment in
Australia in March 2011.
Cash flow
Gross cash flow from operating activities was $1,159 million, 5%
ahead of last year as a result of a better performance from our
terminals. Net cash from investing activities increased to $1,223
million including the proceeds from the monetisation of the
Australian assets.
Net Debt
As at 31 December 2011 our net debt was $3,583 million. Net debt
is significantly lower than the prior year as the $1,476 million
proceeds from the monetisation of investments in Australia, which
were received on 11 March 2011, increased bank balances and cash to
$4,158 million. Gross debt decreased from $7,770 million to $7,742
million as subsidiary debt increased in Cochin (India) and Dakar
(Senegal) following capital investment in additional capacity, in
part offset by the repayment of $197 million of debt across a
number of subsidiaries particularly in the Indian Subcontinent.
Long-term corporate bonds totalled $3.25 billion made up of
$1.75 billion 30 year unsecured MTN due in 2037 and $1.5 billion
10-year unsecured sukuk due in 2017. In addition we have a fully
drawn $3 billion syndicate loan facility due in October 2012 and
$1.65 billion of debt at the subsidiary level. As at 31 December
2011 leverage (net debt to adjusted EBITDA) was 2.7 times.
On 27 March 2012 DP World announced that it will repay all $3
billion outstanding under the $3 billion syndicate loan facility,
due to mature in October 2012, by 10 April 2012, using existing
cash balances. At the same time DP World will cancel $2 billion of
this facility. The remaining $1 billion of undrawn facility will be
replaced by a new 5-year revolving credit facility of $1 billion.
We are in the final phase of agreeing documentation with the banks
that have committed to this new facility and expect it to replace
the existing facility shortly.
Return on Capital Employed
DP World has a portfolio of long-term assets with an average
concession life of 40 years. As at the end of 2011, 25% of our
capacity was less than three years old and is therefore some way
from delivering maximum potential EBIT. When calculating return on
capital employed (EBIT divided by total assets less current
liabilities) for the group, this 25% of immature capacity
significantly reduces the overall returns. In 2011, we reported an
improved return on capital employed to 6.0% against 4.4% in 2010.
Subject to the age profile of our portfolio at any one time, we
would expect to deliver improved returns on capital employed as
terminals mature and generate significantly higher cash flow.
Mohammed Sharaf Yuvraj Narayan
Chief Executive Officer Chief Financial Officer
DP World Limited and its subsidiaries
Consolidated income statement
for the year ended 31 December 2011
Year ended 31 December 2011 Year ended 31 December 2010
Separately Separately
Before disclosed Before disclosed
Notes separately items Total separately items Total
disclosed (Note 11) USD'000 disclosed (Note 11) USD'000
items USD'000 items USD'000
USD'000 USD'000
Revenue from
operations 7 2,977,731 - 2,977,731 3,078,076 110,865 3,188,941
Cost of sales (2,005,159) - (2,005,159) (2,126,965) (110,865) (2,237,830)
------------ ----------- ------------- ------------ ----------- -------------
Gross profit 972,572 - 972,572 951,111 - 951,111
General and
administrative
expenses (256,961) (243,862) (500,823) (329,576) (3,700) (333,276)
Other income 21,029 - 21,029 20,324 8,905 29,229
Share of profit/
(loss) from
equity-accounted
investees (net
of tax) 15 141,711 (3,047) 138,664 140,203 244 140,447
Profit on sale/
termination
of business (net
of tax) 11 - 484,354 484,354 - 13,200 13,200
---------- ---------- ------------ ---------- --------- ----------
Results from
operating
activities 878,351 237,445 1,115,796 782,062 18,649 800,711
---------- ---------- ------------ ---------- --------- ----------
Finance income 9 135,361 - 135,361 89,395 - 89,395
Finance costs 9 (422,931) (10,770) (433,701) (368,223) (17,583) (385,806)
---------- --------- ---------- ---------- --------- ----------
Net finance costs (287,570) (10,770) (298,340) (278,828) (17,583) (296,411)
---------- --------- ---------- ---------- --------- ----------
Profit before
income tax 590,781 226,675 817,456 503,234 1,066 504,300
Income tax
expense 10 (59,042) (7,211) (66,253) (53,174) - (53,174)
----------- ---------- ---------- ----------- -------- ----------
Profit for the
year 8 531,739 219,464 751,203 450,060 1,066 451,126
====== ====== ====== ====== ==== ======
Profit
attributable to:
Owners of the
Company 458,620 224,672 683,292 373,741 1,066 374,807
Non-controlling
interests 73,119 (5,208) 67,911 76,319 - 76,319
----------- ----------- ----------- ---------- ------- ----------
531,739 219,464 751,203 450,060 1,066 451,126
====== ====== ====== ====== ==== ======
Earnings per
share
Basic and diluted
earnings per
share - US cents
(restated) 22 82.32 45.16
===== =====
The accompanying notes form an integral
part
of these consolidated financial
statements
For a full set of notes please visit
www.dpworld.com/investorcentre
Consolidated statement of comprehensive income
for the year ended 31 December 2011
2011 2010
Notes USD'000 USD'000
Profit for the year 751,203 451,126
---------- ----------
Other comprehensive income
Foreign exchange translation differences
for foreign operations * (202,057) 164,671
Foreign exchange (loss)/ profit recycled
to consolidated
income statement (425,773) 500
Effective portion of net changes in fair
value of cash flow hedges (52,308) (35,495)
Net change in cash flow hedges recycled
to
consolidated income statement - 8,974
Net change in fair value of available-for-sale
financial assets 16 8,939 1,139
Defined benefit plan actuarial (loss)/
gain (110,400) 55,100
Share in other comprehensive income of
equity-accounted investees (10,268) 500
Income tax on other comprehensive income:
Fair value of cash flow hedges 14,595 4,500
Defined benefit plan actuarial gain/ (loss) 2,245 (1,100)
----------- ----------
Other comprehensive income for the year,
net of income tax (775,027) 198,789
----------- ----------
Total comprehensive income for the year (23,824) 649,915
====== ======
Total comprehensive income attributable
to:
Owners of the Company (82,589) 588,124
Non-controlling interests 58,765 61,791
----------- ----------
(23,824) 649,915
====== ======
* This includes a significant portion of foreign exchange
translation differences arising from the translation of goodwill
and purchase price adjustments which are denominated in foreign
currencies at the Group level. Furthermore, the translation
differences arising on account of translation of the financial
statements of foreign operations whose functional currencies are
different from that of the Group's presentation currency on Group
consolidation are also reflected here. There are no differences on
translation from functional to presentation currency as the
Company's functional currency is currently pegged to the
presentation currency (refer to note 2(d)).
Consolidated statement of financial position
as at 31 December 2011
2011 2010
Notes USD'000 USD'000
Assets
Non-current assets
Property, plant and equipment 12 5,124,120 5,086,217
Goodwill 13 1,607,655 1,670,301
Port concession rights 13 3,223,958 3,577,813
Investment in equity-accounted investees 15 3,451,264 3,474,113
Deferred tax assets 10 101,212 86,385
Other investments 16 73,193 65,868
Accounts receivable and prepayments 17 260,114 88,378
------------- -------------
Total non-current assets 13,841,516 14,049,075
------------- -------------
Current assets
Inventories 54,979 52,797
Accounts receivable and prepayments 17 624,020 653,216
Bank balances and cash 18 4,159,364 2,519,616
Assets held for sale 28 77,706 2,084,840
------------- -------------
Total current assets 4,916,069 5,310,469
------------- -------------
Total assets 18,757,585 19,359,544
======== ========
Consolidated statement of financial position
as at 31 December 2011
2011 2010
Notes USD'000 USD'000
Equity
Share capital 19 1,660,000 1,660,000
Share premium 20 2,472,655 2,472,655
Shareholders' reserve 20 2,000,000 2,000,000
Retained earnings 2,367,164 1,823,491
Hedging and other reserves 20 (104,408) (64,658)
Actuarial reserve 20 (352,402) (249,700)
Translation reserve 20 (586,555) 40,074
------------ ------------
Total equity attributable to equity
holders of the Company 7,456,454 7,681,862
Non-controlling interests 765,013 814,064
------------ ------------
Total equity 8,221,467 8,495,926
------------ ------------
Liabilities
Non-current liabilities
Deferred tax liabilities 10 1,078,355 1,107,273
Employees' end of service benefits 23 49,393 45,988
Pension and post-employment benefits 235,750 174,900
Interest bearing loans and borrowings 25 4,563,309 7,420,299
Accounts payable and accruals 26 467,240 368,152
------------- ------------
Total non-current liabilities 6,394,047 9,116,612
------------- ------------
Current liabilities
Income tax liabilities 10 169,585 84,304
Bank overdrafts 18 1,017 3,000
Pension and post-employment benefits 12,621 14,500
Interest bearing loans and borrowings 25 3,178,446 349,447
Accounts payable and accruals 26 780,402 939,562
Liabilities held for sale 28 - 356,193
------------- ------------
Total current liabilities 4,142,071 1,747,006
------------- -------------
Total liabilities 10,536,118 10,863,618
------------- -------------
Total equity and liabilities 18,757,585 19,359,544
======== ========
Consolidated statement of changes in equity
For the year ended 31 December 2011
Attributable to equity holders of the Company
Hedging
Share Share Shareholders' Retained and other Actuarial Translation Non-controlling Total
capital premium reserve earnings reserves reserve reserve Total interest equity
USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
Balance as at 1
January
2011 1,660,000 2,472,655 2,000,000 1,823,491 (64,658) (249,700) 40,074 7,681,862 814,064 8,495,926
------------ ------------ ------------ ------------ ---------- ---------- ---------- ------------ ---------- ------------
Total
comprehensive
income for the
year:
Profit for the
year - - - 683,292 - - - 683,292 67,911 751,203
Total other
comprehensive
income, net of
income
tax - - - - (36,550) (102,702) (626,629) (765,881) (9,146) (775,027)
---------- ---------- ---------- ---------- --------- --------- ---------- ---------- --------- ----------
Total
comprehensive
income for the
year - - - 683,292 ( 36,550) (102,702) (626,629) (82,589) 58,765 (23,824)
---------- ---------- ---------- ---------- --------- --------- ---------- ---------- --------- -----------
Transactions
with owners,
recorded
directly in
equity
Dividends paid
(refer
to note 21) - - - (142,760) - - - (142,760) - (142,760)
Settlement of
share-based
payment
transactions - - - - (3,200) - - (3,200) - (3,200)
---------- ---------- ---------- ----------- ------- ---------- -------- ----------- ---------- -----------
Total
transactions
with
owners - - - (142,760) (3,200) - - (145,960) - (145,960)
---------- ---------- ---------- ----------- ------- ---------- -------- ----------- ---------- -----------
Changes in
ownership
interests
in subsidiaries
Acquisition of
non-controlling
interests
without
change in
control * - - - 3,141 - - - 3,141 (20,141) (17,000)
Transactions
with
non-controlling
interests,
recorded
directly in
equity
Dividends paid - - - - - - - - (51,665) (51,665)
Derecognition of
non-controlling
interests
on monetisation
of investment
in
subsidiaries - - - - - - - - (51,763) (51,763)
Acquisition of
subsidiary
with
non-controlling
interests
(refer to
note 30) - - - - - - - - 15,753 15,753
------------ ---------- ---------- ---------- ---------- ---------- ---------- ---------- --------- ------------
Total
transactions
with
non-controlling
interests - - - 3,141 - - - 3,141 (107,816) (104,675)
------------ ------------ ------------ ------------ ---------- ----------- ----------- ------------ ---------- ------------
Balance as at 31
December
2011 1,660,000 2,472,655 2,000,000 2,367,164 (104,408) (352,402) (586,555) 7,456,454 765,013 8,221,467
======= ======= ======= ======= ====== ====== ====== ======= ====== =======
* During the year, the Group acquired an additional 10%
non-controlling interest of USD 20,141 thousand in a subsidiary in
'Australia & Americas' region for a consideration of USD 17,000
thousand resulting in a gain on acquisition.
Consolidated statement of changes in equity
For the year ended 31 December 2010
Attributable to equity holders of the Company
Hedging
Share Share Shareholders' Retained and other Actuarial Translation Non-controlling Total
capital premium reserve earnings reserves reserves reserves Total interest equity
USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
Balance as at 1
January
2010 1,660,000 2,472,655 2,000,000 1,584,804 (49,864) (302,300) (134,347) 7,230,948 806,497 8,037,445
------------ ------------ ------------ ------------ ---------- ---------- ---------- ------------ ---------- ------------
Total
comprehensive
income
for the year:
Profit for the
year - - - 374,807 - - - 374,807 76,319 451,126
Total other
comprehensive
income, net of
income tax - - - - (13,704) 52,600 174,421 213,317 (14,528) 198,789
---------- ---------- ---------- ---------- --------- --------- ---------- ---------- --------- -----------
Total
comprehensive
income
for the year - - - 374,807 (13,704) 52,600 174,421 588,124 61,791 649,915
---------- ---------- ---------- ---------- --------- --------- ---------- ---------- --------- -----------
Transactions
with owners,
recorded
directly in
equity
Dividends paid
(refer to
note
21) - - - (136,120) - - - (136,120) - (136,120)
Settlement of
share-based
payment
transactions - - - - (1,090) - - (1,090) - (1,090)
---------- ---------- ---------- ----------- ------- ---------- -------- ----------- ---------- -----------
Total
transactions
with owners - - - (136,120) (1,090) - - (137,210) - (137,210)
---------- ---------- ---------- ----------- ------- ---------- -------- ----------- ---------- -----------
Transactions
with
non-controlling
interests,
recorded
directly in
equity
Dividends paid - - - - - - - - (54,834) (54,834)
Amounts
contributed
by non-
controlling
interests - - - - - - - - 610 610
------------ ---------- ---------- ---------- ---------- ---------- ---------- ---------- --------- ------------
Total
transactions
with
non-controlling
interests - - - - - - - - (54,224) (54,224)
------------ ------------ ------------ ------------ ---------- ----------- -------- ------------ ---------- -------------
Balance as at
31 December
2010 1,660,000 2,472,655 2,000,000 1,823,491 (64,658) (249,700) 40,074 7,681,862 814,064 8,495,926
======= ======= ======= ======= ===== ====== ===== ======= ====== ========
Consolidated statement of cash flows
For the year ended 31 December 2011
2011 2010
Notes USD'000 USD'000
Cash flows from operating activities
Profit for the year 751,203 451,126
Adjustments for:
Depreciation, amortisation and impairment 8 672,973 462,090
Share of profit from equity-accounted
investees (net of tax) (138,664) (140,447)
Finance costs 9 433,701 385,806
Gain on sale of property, plant and equipment (6,928) (866)
Profit on sale and termination of business (484,354) (13,200)
Finance income 9 (135,361) (89,395)
Income tax expense 10 66,253 53,174
------------ -------------
Gross cash flow from operations 1,158,823 1,108,288
Change in inventories (2,637) (265)
Change in accounts receivable and prepayments 60,374 69,811
Change in accounts payable and accruals (114,941) 169,132
Change in provisions, pensions and
post-employment benefits (48,575) 10,115
----------- ------------
Cash generated from operating activities 1,053,044 1,357,081
Income taxes paid (72,687) (82,139)
----------- ------------
Net cash from operating activities 980,357 1,274,942
----------- ------------
Cash flows from investing activities
Additions to property, plant and equipment 12 (449,508) (710,126)
Acquisition of land 12 - (191,982)
Additions to port concession rights 13 (31,673) (226,606)
Proceeds from disposal of property, plant
and equipment
and port concession rights 31,559 16,169
Proceeds from monetisation of investment 1,476,093 -
in subsidiaries
Cash outflow on monetisation of investment (71,444) -
in subsidiaries
Net cash outflow on acquisition of interest
in a subsidiary 30 (31,315) -
Cash outflow on acquisition of non-controlling (17,000) -
interests
Interest received 108,980 79,217
Proceeds from sale of investment in equity-accounted
investees 111,230 16,834
Dividends received from equity-accounted
investees 160,588 137,215
Additional investment in equity-accounted
investees (11,527) (16,535)
Net loan (given to)/ repaid by equity-accounted
investees (53,385) 25,200
------------ ----------
Net cash from/ (used in) investing activities 1,222,598 (870,614)
------------ ----------
Consolidated statement of cash flows (continued)
For the year ended 31 December 2011
2011 2010
Notes USD'000 USD'000
Cash flows from financing activities
Repayment of interest bearing loans and
borrowings (197,457) (617,517)
Drawdown of interest bearing loans and
borrowings 216,024 439,748
Interest paid (447,405) (358,899)
Dividend paid to the owners of the Company (142,760) (136,120)
Dividends paid to non-controlling interests (51,665) (54,834)
Amounts contributed by non-controlling
interests - 610
---------- ----------
Net cash used in financing activities (623,263) (727,012)
---------- ----------
Net increase/ (decrease) in cash and
cash equivalents 1,579,692 (322,684)
Cash and cash equivalents as at 1 January 2,567,516 2,898,566
Effect of exchange rate fluctuations
on cash held 11,139 (8,366)
------------ ------------
Cash and cash equivalents as at 31 December 18 4,158,347 2,567,516
======= =======
Cash and cash equivalents comprise of
the following:
Bank balances and cash 4,159,364 2,519,616
Cash classified as held for sale - 50,900
Bank overdrafts (1,017) (3,000)
------------ ------------
Cash and cash equivalents 4,158,347 2,567,516
======= =======
Selected Notes to consolidated financial statements
For a full set of Notes please visit DP World Website
6 Segment information
Based on the internal management reports (based on IFRS) that
are reviewed by the Board of Directors ('Chief Operating Decision
Maker') based on the location of the Group's assets and
liabilities, the Group has identified the following geographic
areas as its basis of segmentation. The Group measures segment
performance based on the earnings before separately disclosed
items, interest, tax, depreciation and amortisation ("Adjusted
EBITDA").
-- Asia Pacific and Indian subcontinent
-- Australia and Americas
-- Middle East, Europe and Africa
Each of these operating segments have an individual appointed as
Segment Director responsible for these segments, who in turn
reports to the Chief Operating Decision Maker.
Information regarding the results of each reportable segment is
included below. Performance is measured based on segment profit
before income tax, as included in the internal management reports
that are reviewed by the Group's Board of Directors.
6 Segment information
The following table presents certain results, assets and
liabilities information regarding the Group's segments as at the
reporting date.
Asia Pacific Australia and Middle East, Head office Inter-segment Total
and Indian Americas Europe and Africa
subcontinent
2011 2010 2011 2010 2011 2010 2011 2010 2011 2010 2011 2010
USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
(Including separately disclosed items)
Revenue
from
operations 499,765 571,740 594,065 875,474 1,883,901 1,741,727 - - - - 2,977,731 3,188,941
====== ====== ====== ====== ======= ======= ===== ===== ==== ===== ======= =======
Segment
results
from
operations
* 118,471 157,913 589,973 169,154 490,986 556,919 (149,887) (136,449) - - 1,049,543 747,537
Net finance
costs - - - - - - (298,340) (296,411) - - (298,340) (296,411)
--------- ---------- ---------- --------- ---------- ---------- ---------- ---------- -------- --------- ---------- -----------
Profit/
(loss) for
the year 118,471 157,913 589,973 169,154 490,986 556,919 (448,227) (432,860) - - 751,203 451,126
====== ====== ====== ===== ====== ====== ====== ====== ==== ===== ====== ======
* Segment results from operations comprise profit for the year before net finance cost.
Net finance cost and tax expense from various geographical
locations and head office have been grouped under head office.
6 Segment information
Asia Pacific Australia and Middle East, Head office Inter-segment Total
and Indian subcontinent Americas Europe and Africa
2011 2010 2011 2010 2011 2010 2011 2010 2011 2010 2011 2010
USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
Segment assets 5,076,106 5,344,059 1,847,887 3,755,601 8,031,636 8,443,788 11,185,296 9,517,703 (7,383,340) (7,701,607) 18,757,585 19,359,544
======= ======= ======= ======= ======= ======= ======= ======= ======== ======= ======= ========
Segment liabilities 422,189 417,988 227,370 513,349 1,414,480 1,302,420 7,810,438 8,388,042 (586,299) (949,758) 9,288,178 9,672,041
Tax liabilities
* - - - - - - 1,247,940 1,191,577 - - 1,247,940 1,191,577
---------- ---------- ---------- ---------- ------------ ------------ ------------ ------------- ---------- ---------- ------------- -------------
Total liabilities 422,189 417,988 227,370 513,349 1,414,480 1,302,420 9,058,378 9,579,619 (586,299) (949,758) 10,536,118 10,863,618
====== ====== ====== ====== ======= ======= ======= ======== ====== ====== ======= ========
Capital expenditure
(excluding acquisition
of land) 15,954 241,020 84,279 244,187 378,668 448,403 2,280 3,122 - - 481,181 936,732
====== ====== ====== ====== ====== ====== ==== ===== ===== ===== ====== ======
Acquisition of
land - - - - - 191,982 - - - - - 191,982
====== ====== ===== ===== ====== ===== ==== ===== ===== ===== ====== ======
Depreciation 32,504 36,465 61,103 77,087 194,133 181,170 5,137 4,338 - - 292,877 299,060
===== ===== ===== ===== ====== ====== ==== ==== ===== ===== ====== ======
Amortisation/
impairment 170,231 62,568 37,371 45,311 172,494 55,151 - - - - 380,096 163,030
===== ===== ===== ===== ===== ===== ==== ===== ===== ===== ====== ======
Share of profit
of equity-accounted
investees before
separately disclosed
items 117,354 95,763 10,107 34,800 14,250 9,640 - - - - 141,711 140,203
===== ===== ===== ===== ==== === ===== ===== === === ===== =====
Tax expense before
separately disclosed
items - - - - - - 59,042 53,174 - - 59,042 53,174
===== ===== === ==== ==== === ===== ===== === === ===== =====
* Tax liabilities and tax expenses from various geographical
locations have been grouped under head office.
6 Segment information
Earnings before interest, tax, depreciation and amortisation
("EBITDA") - Adjusted
Asia Pacific Australia Middle East, Head office Inter-segment Total
and Indian subcontinent and Americas Europe and
Africa
2011 2010 2011 2010 2011 2010 2011 2010 2011 2010 2011 2010
USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
Revenue
before
separately
disclosed
items 499,765 460,875 594,065 875,474 1,883,901 1,741,727 - - - - 2,977,731 3,078,076
====== ====== ====== ====== ======= ======= ==== ==== ==== ==== ======= =======
Adjusted
EBITDA 322,158 254,746 203,142 271,403 860,660 793,240 (78,498) (78,937) - - 1,307,462 1,240,452
Net finance
costs - - - - - - (287,570) (278,828) - - (287,570) (278,828)
Tax expense - - - - - - (59,042) (53,174) - - (59,042) (53,174)
Depreciation
and
amortisation (102,772) (99,033) (68,481) (118,698) (252,721) (236,321) (5,137) (4,338) - - (429,111) (458,390)
-------- --------- -------- --------- --------- --------- --------- -------- ------- -------- --------- ---------
Adjusted net
profit/
(loss) for
the
year before
separately
disclosed
items 219,386 155,713 134,661 152,705 607,939 556,919 (430,247) (415,277) - - 531,739 450,060
Adjusted for
separately
disclosed
items (100,915) 2,200 455,312 16,449 (116,953) - (17,980) (17,583) - - 219,464 1,066
---------- ----------- ---------- ---------- ---------- ---------- --------- --------- -------- -------- ---------- ----------
Profit/
(loss)
for the year 118,471 157,913 589,973 169,154 490,986 556,919 (448,227) (432,860) - - 751,203 451,126
====== ====== ====== ====== ====== ===== ====== ====== ===== ===== ====== ======
7 Revenue from operations (including separately disclosed items)
2011 2010
Revenue from operations comprise of: USD'000 USD'000
Containerized stevedoring revenue 1,382,642 1,606,914
Containerized other revenue 973,073 905,503
Non-containerized revenue 622,016 565,659
Service concession revenue - 110,865
------------ ------------
2,977,731 3,188,941
======= =======
The Group does not have any customer which contributes more than
10 per cent of the Group's total revenue.
8 Profit for the year (including separately disclosed items)
2011 2010
USD'000 USD'000
Profit for the year is stated after charging
the following costs:
Staff costs 575,143 674,577
Depreciation, amortisation and impairment 672,973 462,090
Operating lease rentals 412,398 377,705
====== ======
9 Finance income and expenses (including separately disclosed items)
2011 2010
USD'000 USD'000
Financial income
Interest income 123,392 82,405
Exchange gains 7,350 6,590
Other net financing income in respect of
pension plans 4,619 400
--------- ---------
135,361 89,395
--------- ---------
Financial expenses
Interest payable (378,563) (357,164)
Exchange losses (44,344) (6,859)
Other net financing expense in respect of
pension plans (24) (4,200)
---------- ----------
Finance costs before separately disclosed
items (422,931) (368,223)
Adjusted for separately disclosed items (10,770) (17,583)
---------- ----------
Finance costs after separately disclosed
items (433,701) (385,806)
====== ======
Net finance costs after separately disclosed
items (298,340) (296,411)
====== ======
10 Income tax
The major components of income tax expense for the year ended
31December:
2011 2010
USD'000 USD'000
Current income tax expense
Current year 58,190 47,125
Adjustment for prior periods 2,538 2,791
-------- --------
60,728 49,916
Deferred tax (credits)/ expense (1,686) 3,258
-------- --------
59,042 53,174
-------- --------
Income tax expense from continuing operations 59,042 53,174
Tax on separately disclosed items 7,211 -
--------- --------
Total tax expenses 66,253 53,174
Share of income tax of equity-accounted
investees 42,321 37,111
--------- --------
Total tax charge 108,574 90,285
===== =====
Current income tax liabilities 169,585 84,304
===== =====
All tax items included within separately disclosed items are
detailed in note 11.
The Group is not subject to income tax on its UAE operations.
The tax expense relates to the tax payable on the profit earned by
the overseas subsidiaries, associates and joint ventures as
adjusted in accordance with the taxation laws and regulations of
the countries in which they operate. The applicable tax rates in
the regions in which the Group operates are set out below:
Geographical segments Applicable corporate tax rate
Asia Pacific and Indian 16.5% to 35.0%
subcontinent
Australia and Americas 15.0% to 36.0%
Middle East, Europe and
Africa 0% to 34.0%
===========
10 Income tax
The relationship between the tax expense and the accounting
profit can be explained as follows:
2011 2010
USD'000 USD'000
Net profit before tax 817,456 504,300
====== ======
Tax at the Group's domestic tax rate - -
Higher income tax on foreign earnings 439,146 96,941
Permanent differences including non-taxable
income and non-deductible expenses (385,070) 4,929
Tax charge on equity-accounted investees 42,321 37,111
Current year losses not recognised
for deferred tax asset 29,978 17,700
Brought forward losses utilised (247) (6,186)
Deferred tax in respect of fair value
adjustments (28,529) (48,787)
Others (547) (34,410)
--------- ---------
Tax expense before prior year adjustments 97,052 67,298
Tax under provided in prior periods:
- current tax 2,538 2,791
- deferred tax 8,984 20,196
--------- ---------
Total tax expense from operations 108,574 90,285
Adjustment for separately disclosed
items (7,211) -
--------- ---------
Total tax expenses from continuing
operations (A) 101,363 90,285
===== =====
Net profit before tax 817,456 504,300
Adjustment for separately disclosed
items (226,675) (1,066)
Adjustment to share of income tax
of equity-accounted investees 42,321 37,111
---------- ----------
Adjusted profit before tax and before
separately disclosed items (B) 633,102 540,345
====== ======
Effective tax rate before separately
disclosed items (A/B) 16.01% 16.71%
====== ======
Unrecognised deferred tax assets
Deferred tax is not recognised on trading losses of USD 428,749
thousand (2010: USD 450,451 thousand) where utilisation is
uncertain, either because they have not been agreed with tax
authorities, or because the likelihood of future taxable profits is
not sufficiently certain, or because of the impact of tax holidays
on infrastructure projects. Under current legislation, USD 303,676
thousand (2010: USD 427,745 thousand) of these trading losses can
be carried forward indefinitely.
Deferred tax is also not recognised on capital and other losses
of USD 365,423 thousand (2010: USD 451,017 thousand) due to the
fact that their utilisation is uncertain.
10 Income tax
Movement in temporary differences during the year:
Recognised in
consolidated Translation 31 December
1 January 2011 income statement and other movements 2011
USD'000 USD'000 USD'000 USD'000
Deferred tax liability
Property, plant and equipment 139,737 (7,191) 4,333 136,879
Investment in equity-accounted investees 17,232 4,217 (230) 21,219
Fair value adjustment on acquisitions 521,171 (26,165) (2,953) 492,053
Financial instruments 2,219 - (2,219) -
Others 426,914 (6,304) 7,594 428,204
------------ --------- -------- ------------
Total 1,107,273 (35,443) 6,525 1,078,355
======= ===== ==== =======
Deferred tax assets
Property, plant and equipment 4,597 107 1,827 6,531
Employees' end of service benefits 12,190 (5,008) 2,306 9,488
Deferred financing charges 1,213 (1,260) 47 -
Financial instruments - - 14,185 14,185
Provisions 2,952 (2,035) 31,629 32,546
Tax value of losses carried forward
recognised 48,061 (28,131) 2,863 22,793
Others 17,372 2,569 (4,272) 15,669
-------- --------- -------- ----------
Total 86,385 (33,758) 48,585 101,212
===== ===== ===== ======
11 Separately disclosed items
2011 2010
USD'000 USD'000
Construction contract revenue - 110,865
Construction contract costs - (110,865)
Impairment of assets (243,862) (3,700)
Other income - 8,905
Share of (loss)/ profit of equity-accounted
investees (3,047) 244
Profit on sale/ termination of business 484,354 13,200
Loss on currency options and interest
rate swaps (10,770) (17,583)
Income tax expense (7,211) -
---------- --------
219,464 1,066
====== =====
Construction contract revenue and costs 2011: Nil (2010: USD
110,865 thousand represented the revenue recorded in accordance
with IFRIC 12 'Service Concession Arrangements' on construction of
a port in 'Asia Pacific and Indian subcontinent' region. The
construction revenue represented the fair value of the construction
services provided in developing the port. No margin was recognised,
as in management's opinion the fair value of the construction
services provided approximates to the construction cost).
Impairment of assets represents the following:
-- Impairment of net assets in a subsidiary of USD 99,963
thousand in 'Asia Pacific and Indian subcontinent' region
representing the difference between the value in use and the
carrying amount as at the reporting date. The impairment is
primarily due to the change in external factors which are outside
the control of the Group.
-- Impairment of USD 91,016 thousand of investments in
equity-accounted investees, representing the difference between the
fair value less cost to sell and the carrying amount as at the
reporting date. The fair value less cost to sell is derived from
the sale consideration.
-- Impairment of property, plant and equipment of USD 29,993
thousand in the 'Australia and Americas' region and USD 22,890
thousand in the 'Middle East, Europe and Africa' region (2010:
mainly represents impairment on a property held in the 'Australia
and Americas' region). The impairment is mainly due to the change
in market conditions which are outside the control of the
Group.
Other income 2011: Nil(2010: insurance claim settlements of a
non-recurring nature in the 'Australia and Americas' region).
Share of loss from equity accounted investees represents USD
3,047 thousand impairment of deferred tax assets in an equity
accounted investee in the 'Middle East, Europe and Africa'
region.
Profit on sale and termination of business relates to the profit
(net of tax) of USD 435,509 thousand on monetisation of 75%
interest in the Australia Ports business and sale of interest in an
associate in the 'Australia and Americas' region resulting in a
profit (net of tax) of USD 49,796 thousand. The profit on sale and
termination of business includes foreign exchange reserves recycled
to the consolidated income statement on account of loss of control.
This is offset by USD 951 thousand loss on termination of a
non-core business in the 'Asia Pacific and Indian subcontinent'
region. (2010: the profit on sale of investment in an associate in
the 'Australia and Americas' region).
Loss on currency options and interest rate swaps represents USD
10,770 thousand loss on foreign currency options related to the
'Australia and Americas' region. (2010 represents USD 6,200
thousand recycling of hedge reserve to consolidated income
statement in the 'Middle East, Europe and Africa' region and USD
11,383 thousand losses on foreign currency options related to the
'Australia and Americas' region).
Income tax expenserepresents USD 12,785 thousand of deferred tax
assets impaired in a subsidiary in the 'Middle East, Europe and
Africa' region which is offset by USD 5,574 thousand of tax credit
on impairment of assets in the 'Australia and Americas' region
(2010: Nil).
12 Property, plant and equipment
Land and Plant and
buildings equipment Ships Capital work-in-progress Total
USD'000 USD'000 USD'000 USD'000 USD'000
Cost
As at 1 January 2011 3,000,931 2,491,086 131,080 604,271 6,227,368
Acquired through
business combination 29,099 - - - 29,099
Additions during
the year 8,342 22,827 73,951 344,388 449,508
Transfers from capital
work-in-progress 73,911 59,061 7,031 (140,003) -
Translation adjustment (19,881) (52,201) 4,417 (16,896) (84,561)
Disposals (22,818) (33,845) - - (56,663)
------------ ------------ ---------- ---------- ------------
As at 31 December
2011 3,069,584 2,486,928 216,479 791,760 6,564,751
------------ ------------ ---------- ---------- ------------
Depreciation and
impairment
As at 1 January 2011 364,690 756,326 20,135 - 1,141,151
Charge for the year 106,763 163,266 22,848 - 292,877
Impairment (refer
note to 11) 17,918 4,932 30,033 - 52,883
Translation adjustment (4,089) (11,173) 1,757 - (13,505)
On disposals (2,747) (30,028) - - (32,775)
---------- ---------- --------- ---------- ------------
As at 31 December
2011 482,535 883,323 74,773 - 1,440,631
---------- ----------- --------- ---------- ------------
Net book value:
As at 31 December
2011 2,587,049 1,603,605 141,706 791,760 5,124,120
======= ======= ====== ====== =======
In the prior years, the Group had entered into agreements with
third parties pursuant to which the Group participated in a series
of linked transactions including leasing and sub-leasing of certain
cranes of the Group ("the Crane French Lease Arrangements"). At 31
December 2011, cranes with aggregate net book value amounting to
USD 304,449 thousand (2010: USD 320,188 thousand) were covered by
these Crane French Lease Arrangements. These cranes are accounted
for as property, plant and equipment as the Group retains all the
risks and rewards incidental to the ownership of the underlying
assets.
At 31 December 2011, property, plant and equipment with a
carrying amount of USD 1,148,903 thousand (2010: USD 596,856
thousand) are pledged to secure bank loans (refer to note 25). At
31 December 2011, the net carrying value of the leased plant and
equipment and other assets was USD 59,067 thousand (2010: USD
58,854 thousand).
Borrowing costs capitalised to property, plant and equipment
amounted to USD 10,512 thousand (2010: USD 39,781 thousand) with a
capitalisation rate in the range of 4.73 % to 5.08% per annum
(2010: 7% to 8% per annum).
12 Property, plant and equipment (continued)
Land and Plant Capital
buildings and equipment Ships work-in-progress Total
USD'000 USD'000 USD'000 USD'000 USD'000
Cost
As at 1 January 2010 2,677,914 2,680,045 46,638 627,005 6,031,602
Additions during the year 41,212 83,959 81,097 695,840 902,108
Transfer to assets held
for sale (195,319) (523,841) - (31,119) (750,279)
Transfers from capital
work-in-progress 453,054 231,320 - (684,374) -
Translation adjustment 25,307 62,309 4,272 (3,081) 88,807
Disposals (1,237) (42,706) (927) - (44,870)
------------ ------------ ---------- ---------- ------------
As at 31 December 2010 3,000,931 2,491,086 131,080 604,271 6,227,368
------------ ------------ ---------- ---------- ------------
Depreciation
As at 1 January 2010 307,995 853,698 10,709 - 1,172,402
Charge for the year 98,457 191,485 9,118 - 299,060
Transfer to assets held
for sale (53,757) (301,285) - - (355,042)
Translation adjustment 12,922 40,445 1,235 - 54,602
On disposals (927) (28,017) (927) - (29,871)
---------- ---------- --------- ---------- ------------
As at 31 December 2010 364,690 756,326 20,135 - 1,141,151
---------- ----------- --------- ---------- ------------
Net book value:
As at 31 December 2010 2,636,241 1,734,760 110,945 604,271 5,086,217
======= ======= ====== ====== =======
13 Goodwill and port concession rights
Port
concession
Goodwill rights Total
USD'000 USD'000 USD'000
Cost
As at 1 January 2011 1,670,301 4,118,142 5,788,443
Acquired through business combination
(refer to note 30) 9,693 32,474 42,167
Additions - 31,673 31,673
Impairment loss (12,790) - (12,790)
Disposals - (2,385) (2,385)
Translation adjustment (59,549) (237,927) (297,476)
------------ ------------ ------------
As at 31 December 2011 1,607,655 3,941,977 5,549,632
------------ ------------ ------------
Amortisation and impairment losses
As at 1 January 2011 - 540,329 540,329
Charge for the year - 136,234 136,234
Impairment loss - 96,710 96,710
On disposals - (1,642) (1,642)
Translation adjustment - (53,612) (53,612)
----------- ---------- ----------
As at 31 December 2011 - 718,019 718,019
----------- ---------- ----------
Net book value:
As at 31 December 2011 1,607,655 3,223,958 4,831,613
======= ======= =======
13 Goodwill and port concession rights (continued)
Port concession rights include concession agreements which are
mainly accounted for as business combinations and acquisitions.
These concessions were determined to have finite and indefinite
useful lives based on the terms of the respective concession
agreements and the income approach model was used for the purpose
of determining their fair values.
At 31 December 2011, port concession rights with a carrying
amount of USD 344,668 thousand (2010: USD 478,315 thousand) are
pledged to secure bank loans (refer to note 25).
Port concession
Goodwill rights Total
USD'000 USD'000 USD'000
Cost
As at 1 January 2010 2,424,689 4,714,661 7,139,350
Additions - 226,606 226,606
Disposals - (2,628) (2,628)
Transfer to assets held for sale (846,748) (871,583) (1,718,331)
Translation adjustment 92,360 51,086 143,446
------------ ------------ ------------
As at 31 December 2010 1,670,301 4,118,142 5,788,443
------------ ------------ ------------
Amortisation
As at 1 January 2010 - 540,466 540,466
Charge for the year - 159,330 159,330
On disposals - (2,324) (2,324)
Transfer to assets held for sale - (190,961) (190,961)
Translation adjustment - 33,818 33,818
----------- ---------- ----------
As at 31 December 2010 - 540,329 540,329
----------- ---------- ----------
Net book value:
As at 31 December 2010 1,670,301 3,577,813 5,248,114
======= ======= =======
14 Impairment testing
Goodwill acquired through business combinations and port
concession rights with indefinite useful lives have been allocated
to various cash-generating units ("CGU"), which are reportable
business units, for the purposes of impairment testing.
Impairment testing is done at an operating port level that
represents an individual CGU. Details of the CGUs by operating
segment are shown below:
Carrying amount
of port concession
rights with Perpetuity
Carrying amount indefinite useful Discount growth
of goodwill life rates rate
2011 2010 2011 2010
USD'000 USD'000 USD'000 USD'000
Cash-generating
units aggregated
by operating segment
Asia Pacific and 8.50% - 2.50% -
Indian subcontinent 233,123 275,820 - - 15.50% 5.00%
8.00% - 2.00% -
Australia and Americas 323,104 332,486 - - 14.50% 2.50%
Middle East, Europe 7.00% - 2.50% -
and Africa 1,051,428 1,061,995 989,012 1,004,851 12.50% 4.00%
------------ ------------ ------------ ------------
Total 1,607,655 1,670,301 989,012 1,004,851
======= ======= ======= =======
The recoverable amount of the CGU has been determined based on
their value in use calculated using cash flow projections based on
the financial budgets approved by management covering a three year
period and a further outlook for five years, which is considered
appropriate in view of the outlook for the industry and the
long-term nature of the concession agreements held i.e. generally
for a period of 25 -50 years.
Key assumptions used in value in use calculations
The followingdescribes each key assumption on which management
has based its cash flow projections to undertake impairment testing
of goodwill and port concession rights with indefinite useful
lives.
Budgeted margins - The basis used to determine the value
assigned to the budgeted margin is the average gross margin
achieved in the year immediately before the budgeted year, adjusted
for expected efficiency improvements, price fluctuations and
manpower costs.
Discount rates - These represent the cost of capital for the
Group adjusted for the respective location risk factors. The Group
uses the post tax Weighted Average Cost of Capital which reflects
the country specific risk adjusted discount rate.
Cost inflation - The forecast general price index is used to
determine the cost inflation during the budget year for the
relevant countries where the Group is operating.
Perpetuity growth rate - In management's view, the perpetuity
growth rate is the minimum growth rate expected to be achieved
beyond the eight year period. This is based on the overall regional
economic growth forecasted and the Group's internal capacity
changes for a given region. The Group also takes into account
competition and regional capacity growth to provide a comprehensive
growth assumption for the entire portfolio.
The values assigned to key assumptions are consistent with the
past experience of management.
Sensitivity to changes in assumptions
The calculation of value in use for the CGU is sensitive to
future earnings and therefore a sensitivity analysis was performed.
The analysis demonstrated that a 10% decrease in earnings for a
future period of three years from the reporting date would not
result in an impairment.
15 Investment in equity-accounted investees
Summary financial information for equity-accounted investees,
not adjusted for the percentage ownership held by the Group:
Asia Pacific and Australia Middle East, Total
Indian subcontinent and Americas Europe and Africa
2011 2010 2011 2010 2011 2010 2011 2010
USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
Current
assets 492,575 397,686 425,910 402,539 316,072 321,606 1,234,557 1,121,831
Non-current
assets 7,533,647 7,381,166 2,799,767 833,592 2,311,415 2,877,660 12,644,829 11,092,418
------------ ------------ ------------ ------------ ------------ ------------ -------------- --------------
Total assets 8,026,222 7,778,852 3,225,677 1,236,131 2,627,487 3,199,266 13,879,386 12,214,249
======= ======= ======= ======= ======= ======= ======== =========
Current
liabilities 511,661 929,830 236,265 136,751 181,051 169,780 928,977 1,236,361
Non-current
liabilities 1,528,068 1,255,237 1,458,954 237,751 841,070 939,289 3,828,092 2,432,277
------------ ------------ ---------- ---------- ------------ ------------ ------------ ------------
Total
liabilities 2,039,729 2,185,067 1,695,219 374,502 1,022,121 1,109,069 4,757,069 3,668,638
======= ======= ====== ====== ======= ======= ======= =======
Revenue 1,203,610 1,036,384 749,426 493,733 694,793 637,421 2,647,829 2,167,538
Expenses (937,343) (823,137) (765,353) (429,811) (639,529) (586,595) (2,342,225) (1,839,543)
---------- --------- --------- --------- --------- --------- ----------- ------------
Net profit/
(loss) 266,267 213,247 (15,927) 63,922 55,264 50,826 305,604 327,995
====== ====== ===== ===== ===== ===== ====== ======
The Group's share of profit from equity-accounted investees (before separately
disclosed items) 141,711 140,203
====== =======
The Group's investments in equity-accounted investees as at 31 December 3,451,264 3,474,113
======= =======
16 Other investments
2011 2010
USD'000 USD'000
Non-current investments
Debt securities held to maturity 12,815 14,429
Available-for-sale financial assets 60,378 51,439
--------- ---------
73,193 65,868
===== =====
Available-for-sale financial assets consist of unquoted
investment in an Infrastructure Fund. The movement schedule for
these investments is as follows:
2011 2010
USD'000 USD'000
As at 1 January 51,439 50,560
Return of capital during the year - (260)
Change in fair value recognised in other
comprehensive income 8,939 1,139
--------- ---------
As at 31 December 60,378 51,439
===== =====
17 Accounts receivable and prepayments
2011 2011 2011
Non-current Current Total
USD'000 USD'000 USD'000
Trade receivables (net) - 232,957 232,957
Advances paid to suppliers - 28,268 28,268
Other receivables and prepayments 53,425 258,700 312,125
Employee benefit assets (refer
to note 24) 155 - 155
Due from related parties (refer
to note 27) 206,534 104,095 310,629
---------- ---------- ----------
260,114 624,020 884,134
====== ====== ======
2010 2010 2010 2010
Non-current Current Total
USD'000 USD'000 USD'000
Trade receivables (net) 1,586 227,156 228,742
Advances paid to suppliers - 13,653 13,653
Other receivables and prepayments 51,580 304,214 355,794
Fair value of derivative financial
instruments 200 10,770 10,970
Employee benefit assets (refer
to note 24) 500 - 500
Due from related parties (refer
to note 27) 34,512 97,423 131,935
--------- ---------- ----------
88,378 653,216 741,594
===== ====== ======
The Group's exposure to credit and currency risks related to
trade receivables, other receivables and due from related parties
are disclosed in note 29.
18 Bank balances and cash
2011 2010
USD'000 USD'000
Cash at banks and in hand 468,673 443,542
Short-term deposits 3,637,270 2,076,074
Deposits under lien 53,421 -
------------- -------------
Bank balances and cash 4,159,364 2,519,616
Bank overdrafts (1,017) (3,000)
------------ -------------
4,158,347 2,516,616
Cash classified as held for sale (refer
to note 28(a)) - 50,900
------------ -------------
Cash and cash equivalents for statement
of cash flows 4,158,347 2,567,516
======= =======
Short-term deposits are made for varying periods between one day
and three months depending on the immediate cash requirements of
the Group and earn interest at the respective short-term deposit
market rates. Bank overdrafts are repayable on demand.
The deposits under lien amounting to USD 53,421 thousand (2010:
NIL) are placed to collateralise some of the borrowings of the
Company's subsidiaries.
19 Share capital
The share capital of the Company as at 31 December was as
follows:
2011 2010
USD'000 USD'000
Authorised
1,250,000,000/ 25,000,000,000 ordinary
shares of
USD 2.00/ 0.10 each 2,500,000 2,500,000
======= ========
Issued and fully paid
830,000,000/ 16,600,000,000 ordinary shares
of
USD 2.00/ 0.10 each 1,660,000 1,660,000
======= =======
On 19 May 2011, the Company consolidated 20 ordinary shares of
USD 0.10 each into one share of USD 2.00.
20 Reserves
Share premium
Share premium represents surplus received over and above the
nominal cost of the shares issued to the shareholders and forms
part of the shareholder equity. The reserve is not available for
distribution except in circumstances as stipulated by the law.
Shareholders' reserve
Shareholders' reserve forms part of the distributable reserves
of the Group.
Hedging reserve
The hedging reserve comprises the effective portion of the
cumulative net change in the fair value of the cash flow hedging
instruments related to hedge transactions that have not yet
occurred.
Other reserves
The other reserves mainly include statutory reserves of
subsidiaries as required by applicable local legislations and
share-based payment transactions. This reserve also includes the
unrealised fair value changes on available-for-sale
investments.
Actuarial reserve
The actuarial reserve comprises the cumulative actuarial losses
recognised in other comprehensive income.
Translation reserve
The translation reserve comprises all foreign currency
differences arising from the translation of the financial
statements of foreign operations whose functional currencies are
different from that of the Group's presentation currency. It also
includes foreign exchange translation differences arising from
translation of goodwill and purchase price adjustments which are
denominated in foreign currencies at the Group level.
21 Dividends
2011 2010
USD'000 USD'000
Declared and paid during the year:
Final dividend 17* US cents per share/
16* US cents per share 142,760 136,120
====== ======
Proposed for approval at the annual
general meeting
(not recognised as a liability as
at 31 December):
Final dividend: 24 US cents per share/
17* US cents per share 199,200 142,760
====== ======
* Rounded to reflect share consolidation, as explained
in note 22 below.
22 Earnings per share
Basic earnings per share
The calculation of basic earnings per share is based on the
profit attributable to ordinary shareholders and the weighted
average number of ordinary shares outstanding.
2011 2010
USD'000 USD'000
Profit attributable to ordinary shareholders 683,292 374,807
====== ======
Number of shares Number of
shares
(restated)
Number of ordinary shares outstanding
as at 31 December 830,000,000 830,000,000
========= =========
On 19 May 2011, the Company consolidated 20 ordinary shares of
USD 0.10 each into one share of USD 2.00 which has been used for
the calculation of earnings per share for the current year.
Accordingly, the previous year earnings per share has been
restated.
22 Earnings per share (continued)
2011 2010
USD USD
Basic earnings per share after
separately disclosed items - (US cents) 82.32 45.16
==== ====
Basic earnings per share before
separately disclosed items - (US cents) 55.26 45.03
==== ====
The Company has no share options outstanding at the year end and
therefore the basic and diluted earnings per share are not
different.
23 Employees' end of service benefits
Movements in the provision recognised in the consolidated
statement of financial position are as follows:
2011 2010
USD'000 USD'000
As at 1 January 45,988 42,948
Provision made during the year * 13,933 13,793
Amounts paid during the year (10,528) (10,753)
--------- ---------
As at 31 December 49,393 45,988
===== =====
* The provision for expatriate staff gratuities, included in
Employees' end of service benefits, is calculated in accordance
with the regulations of the Jebel Ali Free Zone Authority. This is
based on the liability that would arise if employment of all staff
were terminated at the reporting date.
The UAE government had introduced Federal Labour Law No.7 of
1999 for pension and social security. Under this Law, employers are
required to contribute 15% of the 'contribution calculation salary'
of those employees who are UAE nationals. These employees are also
required to contribute 5% of the 'contribution calculation salary'
to the scheme. The Group's contribution is recognised as an expense
in the consolidated income statement as incurred.
25 Interest bearing loans and borrowings
This note provides information about the terms of the Group's
interest-bearing loans and borrowings, which are measured at
amortised cost. Information about the Group's exposure to interest
rate, foreign currency and liquidity risk are described in note
29.
2011 2010
USD'000 USD'000
Non-current liabilities
Secured bank loans 720,482 682,968
Mortgage debenture stock 2,212 2,221
Unsecured loan stock 5,071 5,093
Unsecured bank loans 552,842 3,442,000
Unsecured bond issues 3,235,320 3,233,518
Finance lease liabilities 47,382 54,499
------------ ------------
4,563,309 7,420,299
------------ ------------
Current liabilities
Secured bank loans 100,242 76,333
Unsecured bank loans 3,062,653 258,420
Unsecured loans 3,619 2,433
Finance lease liabilities 11,932 12,261
---------- ----------
3,178,446 349,447
------------ ------------
Total 7,741,755 7,769,746
======= =======
25 Interest bearing loans and borrowings (continued)
Terms and debt repayment schedule
Terms and conditions of outstanding loans were as follows:
2011
Nominal Carrying
interest Face value amount
Currency Notes rate Year of maturity USD'000 USD'000
Secured loans
EGP Variable 2013 1,971 1,971
EGP Variable 2012 1,128 1,128
EUR Variable 2017-2024 100,714 100,714
EUR Variable 2012 16,533 16,533
EUR 2% 2024 13,683 13,683
EUR 2% 2012 1,140 1,140
HKD Variable 2015 835 835
HKD Variable 2012 371 371
INR Variable 2015-2017 59,891 59,891
INR Variable 2012 16,741 16,741
PKR Variable 2018 75,306 75,306
USD 3% - 8% 2013-2019 6,081 6,081
USD 3% 2012 1,008 1,008
USD Variable 2014-2020 461,177 461,177
USD Variable 2012 63,145 63,145
ZAR 10% 2017 824 824
ZAR 10% 2012 176 176
Unsecured loans
CAD Variable 2013 153,307 153,307
CAD Variable 2012 14,688 14,688
INR Variable 2014 41,500 41,500
INR Variable 2012 3,772 3,772
INR 11.25% 2012 28,295 28,295
SAR Variable 2017 19,205 19,205
SAR Variable 2012 4,027 4,027
USD 4.14% 2024 28,831 28,831
USD 4.14%-6.21% 2012 3,062 3,062
USD (a) Variable 2012 3,000,000 2,997,792
USD Variable 2013 311,199 311,199
USD Variable 2012 11,017 11,017
EUR Variable 2012 2,419 2,419
Mortgage debenture
stock
GBP 3.50% undated 2,212 2,212
Unsecured loan stock
GBP 7.50% undated 5,071 5,071
Unsecured Bond
USD 7.88% 2027 8,000 7,935
Unsecured sukuk bonds
USD (b) * 2017 1,500,000 1,488,922
Unsecured MTNs
USD (b) 6.85% 2037 1,750,000 1,738,463
Finance lease liabilities
4.14% -
in various currencies 14% 2012-2054 59,314 59,314
------------ ------------
7,766,643 7,741,755
======= =======
* The profit rate on this Islamic Bond is 6.25%.
25 Interest bearing loans and borrowings (continued)
(a) The unsecured bank loans represents USD 3,000,000 thousand
(2010: USD 3,000,000 thousand) drawn under a USD 3,000,000 thousand
revolving credit facility. This is a committed facility with a
final maturity on 22 October 2012.
(b) The Group has a listed conventional bond of USD 1,750,000
thousand Medium Term Note and a Sukuk (Islamic Bond) of USD
1,500,000 thousand listed under DP World Sukuk Limited on Nasdaq
Dubai and the London Stock Exchange (LSE).
Certain property, plant and equipment and port concession rights
are pledged against the facilities obtained from the banks (refer
to note 12 and note 13). The deposits under lien amounting to USD
53,421 thousand (2010: Nil) are placed to collateralise some of the
borrowings of the Company's subsidiaries (2010: Nil) (refer to note
18).
There has been no issuance or repayment of debt securities in
the current year (2010: Nil). At 31 December 2011, the undrawn
committed borrowing facilities of USD 1,037,021 thousand (2010: USD
60,213 thousand) were available to the Group, in respect of which
all conditions precedent had been met.
25 Interest bearing loans and borrowings (continued)
Terms and debt repayment schedule
Terms and conditions of outstanding loans were as follows:
Nominal 2010 Carrying
interest Year of Face value amount
Currency Notes rate maturity USD'000 USD'000
Secured loans
EGP 14% 2013 4,684 4,684
EUR Variable 2019-2023 7,644 7,644
EUR 7% 2024 16,497 16,497
HKD 2.90% 2015 1,576 1,576
INR 11.62% 2015 11,183 11,183
INR Variable 2015-2017 94,762 94,762
PKR Variable 2018-2019 80,155 80,155
2.76% -
USD 4.75% 2013-2014 36,230 36,230
USD Variable 2011-2019 505,135 505,135
ZAR Variable 2016 1,435 1,435
Unsecured loans
CAD Variable 2011 194,374 194,374
INR Variable 2011-2014 62,886 62,886
INR 7.9% - 8.13% 2011-2012 72,451 72,451
SAR Variable 2017 27,259 27,259
USD 4.14% 2024 32,876 32,876
USD (a) Variable 2012 3,000,000 2,995,143
USD Variable 2011 315,431 315,431
EUR Variable 2011 2,433 2,433
Mortgage debenture
stock
GBP 3.50% undated 2,221 2,221
Unsecured loan stock
GBP 7.50% undated 5,093 5,093
Unsecured Bond
USD 7.88% 2027 8,000 7,929
Unsecured sukuk
bonds
USD (b) * 2017 1,500,000 1,487,289
Unsecured MTNs
USD (b) 6.85% 2037 1,750,000 1,738,300
Finance lease liabilities
4.14% -
in various currencies 14% 2011-2054 66,760 66,760
------------ ------------
7,799,085 7,769,746
======= =======
* The profit rate on this Islamic Bond is 6.25%.
25 Interest bearing loans and borrowings (continued)
Finance lease liabilities
The Group classifies certain property, plant and equipment as
finance leases where it retains all risks and rewards incidental to
the ownership. The net carrying values of assets taken under
finance leases are disclosed in note 12.
Future minimum lease payments under finance leases together with
the present value of the net minimum lease payments are as
follows:
2011
Present value
Future minimum of minimum
lease payments Interest lease payments
USD'000 USD'000 USD'000
Less than one year 15,833 (3,901) 11,932
Between one and five years 43,689 (8,866) 34,823
More than five years 22,647 (10,088) 12,559
-------- --------- ---------
At 31 December 82,169 (22,855) 59,314
===== ===== =====
2010 Present
Future minimum value of minimum
lease payments Interest lease payments
USD'000 USD'000 USD'000
Less than one year 15,391 (2,898) 12,493
Between one and five years 41,009 (10,962) 30,047
More than five years 34,296 (10,076) 24,220
-------- --------- ---------
At 31 December 90,696 (23,936) 66,760
===== ===== =====
The finance leases do not contain any escalation clauses and do
not provide for contingent rents.
26 Accounts payable and accruals
2011
Non-current Current Total
USD'000 USD'000 USD'000
Trade payables - 138,616 138,616
Other payables and accruals 386,071 549,699 935,770
Provisions * 269 26,479 26,748
Fair value of derivative
financial instruments 80,900 53,336 134,236
Amounts due to related
parties (refer to note
27) - 12,272 12,272
---------- ---------- ------------
As at 31 December 467,240 780,402 1,247,642
====== ====== =======
26 Accounts payable and accruals (continued)
2010
Non-current Current Total
USD'000 USD'000 USD'000
Trade payables - 201,546 201,546
Other payables and accruals 338,952 607,361 946,313
Provisions * 800 43,900 44,700
Fair value of derivative financial
instruments 26,800 69,579 96,379
Amounts due to related parties (refer
to note 27) 1,600 17,176 18,776
---------- ---------- ------------
As at 31 December 368,152 939,562 1,307,714
====== ====== =======
* During the current year additional provision of USD 13,598
thousand was made (2010: USD 32,000 thousand) and an amount of USD
31,550 thousand was utilised (2010: USD 18,000 thousand).
27 Related party transactions
For the purpose of these consolidated financial statements,
parties are considered to be related to the Group, if the Group has
the ability, directly or indirectly, to control the party or
exercise significant influence over it in making financial and
operating decisions, or vice versa, or where the Group and the
party are subject to common control or significant influence i.e.
part of the same Parent Group.
Related parties represent associated companies, shareholders,
directors and key management personnel of the Group, the Parent
Company, ultimate Parent Company (Dubai World Corporation) and
entities jointly controlled or significantly influenced by such
parties. Pricing policies and terms of these transactions are
approved by the Group's management. The terms and conditions of the
related party transaction were made on an arm's length basis.
The Parent Group operates a Shared Services Unit ("SSU") which
recharges the proportionate costs of services provided to the
Group. SSU also processes the payroll for the Group and recharges
the respective payroll costs.
Transactions with related parties included in the consolidated
financial statements are as follows:
Equity-
accounted Other related
investees parties 2011 Total
USD'000 USD'000 USD'000
Expenses charged:
Concession fee - 48,166 48,166
Shared services - 9,259 9,259
Other services - 20,676 20,676
Revenue earned:
Management fee income 23,248 - 23,248
===== ===== =====
27 Related party transactions (continued)
Equity
accounted Other related
investees parties 2010 Total
USD'000 USD'000 USD'000
Expenses charged:
Concession fee - 48,169 48,169
Shared services - 10,055 10,055
Other services - 13,770 13,770
Revenue earned:
Management fee income 13,020 - 13,020
===== ===== =====
Balances with related parties included in the statement of
financial position are as follows:
Due from Due to
related parties related parties
2011 2010 2011 2010
USD'000 USD'000 USD'000 USD'000
Ultimate Parent Company 2,730 3,793 - -
Parent Company 54,154 65,750 - -
Equity-accounted investees 232,052 43,400 386 1,600
Other related parties 21,693 18,992 11,886 17,176
---------- ---------- --------- ---------
310,629 131,935 12,272 18,776
====== ====== ===== =====
Loan and lease guarantees issued on behalf of equity-accounted
investees amount to USD 12,020 thousand (2010: USD 5,785
thousand).
Compensation of key management personnel
The remuneration of directors and other key members of the
management during the year were as follows:
2011 2010
USD'000 USD'000
Short-term benefits and bonus 8,620 6,699
Post retirement benefits 722 512
------- -------
9,342 7,211
==== ====
28 Assets and liabilities held for sale
2011 2010
USD'000 USD'000
Asset held for sale
Australia and America region (refer to note
(a)) - 2,071,000
Other regions (refer to note (b)) 77,706 13,840
--------- --------------
77,706 2,084,840
===== ========
Liabilities held for sale
Australia and America region (refer to note
(a)) - 356,193
===== ======
(a) On 22 December 2010, the Group and Citi Infrastruture
Investors ("CII"), together with one of CII's major investors
announced their intention to form a strategic partnership in
relation to the Group's five marine terminals in Australia which
was subsequently completed on 11 March 2011.
The major class of assets and liabilities as at 31 December were
as follows:
2011 2010
USD'000 USD'000
Non-current assets
Property, plant and equipment (refer to
note 12) - 392,198
Port concession rights (refer to note 13) - 680,622
Goodwill (refer to note 13) - 846,748
Investment in equity-accounted investees - 1,000
Deferred tax assets - 27,400
----- ------------
- 1,947,968
----- ------------
Current assets
Inventories - 6,000
Accounts receivable and prepayments (net) - 66,132
Bank balances and cash (refer to note 18) - 50,900
----- -----------
- 123,032
----- ------------
Asset classified as held for sale - 2,071,000
=== =======
Non-current liabilities
Deferred tax liabilities - 213,293
Pension and post-employment benefits - 6,900
Interest bearing loans and borrowings - 21,900
---- ----------
- 242,093
---- ----------
28 Assets and liabilities held for sale (continued)
2011 2010
USD'000 USD'000
Current liabilities
Income tax liabilities - 5,800
Pension and post-employment benefits - 49,100
Interest bearing loans and borrowings - 3,500
Accounts payable and accruals - 55,700
----- ----------
- 114,100
----- ----------
Liabilities classified as held for sale - 356,193
=== ======
(b) Assets held for sale in other regions mainly includes
investment in Tilbury Container Services Limited which has been
disposed in 2012 (refer to note 35).
30 Business combination
On 16 August 2011, the Company acquired 60% interest in Integra
Port Services N.V and Suriname Port Services N.V ("Suriname Group")
for a total cost of USD 31,315 thousand (net of cash). The Suriname
Group is engaged in the ports business in the Republic of
Suriname.
This acquisition has resulted in recognition of goodwill of USD
9,693 thousand, port concession rights of USD 32,474 thousand and
non-controlling interest of USD 15,753 thousand.
From the date of acquisition, Suriname Group has contributed
revenue of USD 5,898 thousand and profit of USD 1,567 thousand. If
the acquisition had taken place at the beginning of the year, the
revenue would have been USD 15,600 thousand and profit would have
been USD 4,144 thousand.
31 Operating leases
Operating lease commitments - Group as a lessee
Future minimum rentals payable under non-cancellable operating
leases as at 31 December are as follows:
2011 2010
USD'000 USD'000
Within one year 192,961 178,080
Between one to five years 711,097 1,104,490
Between five to ten years 1,086,178 1,354,819
Between ten to twenty years 1,398,808 1,642,390
Between twenty to thirty years 1,357,630 708,095
Between thirty to fifty years 1,201,046 1,031,959
Between fifty to seventy years 1,063,338 914,908
More than seventy years 1,075,017 1,120,762
------------- --------------
8,086,075 8,055,503
======== ========
The above operating leases (Group as a lessee) mainly consist of
terminal operating leases arising out of concession arrangements
which are long term in nature. In addition, this also includes
leases of plant, equipment and vehicles. In respect of terminal
operating leases, contingent rent is payable based on revenues/
profits earned in the future period. The majority of leases contain
renewable options for additional lease periods at rental rates
based on negotiations or prevailing market rates.
Operating lease commitments - Group as a lessor
Future minimum rentals receivable under non-cancellable
operating leases as at 31 December are as follows:
2011 2010
USD'000 USD'000
Within one year 22,691 22,163
Between one to five years 75,966 61,483
More than five years 25,887 38,075
---------- ----------
124,544 121,721
====== ======
Operating lease commitments - Group as a lessor (continued)
The above operating leases (Group as a lessor) mainly consist of
rental of property, plant and equipment leased out by the Group.
The leases contain renewal options for additional lease periods and
at rental rates based on negotiations or prevailing market
rates.
32 Capital commitments
2011 2010
USD'000 USD'000
Estimated capital expenditure contracted
for as at 31 December 538,383 462,425
====== ======
33 Contingencies
(a) The Group has contingent liabilities amounting to USD 99,491
thousand (2010: USD 143,827 thousand) in respect of payment
guarantees, USD 82,117 thousand (2010: USD 114,446 thousand) in
respect of performance guarantees and USD 195 thousand (2010: 2,266
thousand) in respect of letters of credit issued by the Group's
bankers. The bank guarantees and letters of credit are arising in
the ordinary course of business from which it is anticipated that
no material liabilities will arise.
(b) The Group has contingent liabilities in respect of loan and
lease guarantees issued on behalf of equity-accounted investees
(refer to note 27).
(c) The Group through its 100% owned subsidiary Mundra
International Container Terminal Private Limited ("MICT") has
developed and is operating the container terminal at the Mundra
port in Gujarat.
In 2006, MICT received a show cause notice from Gujarat Maritime
Board ("GMB") requiring MICT to demonstrate that the undertaking
given by its parent company, P&O Ports (Mundra) Private
Limited, with regard to its shareholding in MICT has not been
breached in view of P&O Ports being taken over by the Group (DP
World).
Based on the strong merits of the case and on the advice
received from legal counsel, management believes that the above
litigation is unsubstantiated, and in management's view, it will
have no impact on the Group's ability to continue to operate the
port.
(d) Chennai Port Trust ("CPT") has raised a demand for an amount
of USD 22,548 thousand (2010: 26,733 thousand) from Chennai
Container Terminal Limited ("CCTL"), a subsidiary of the Group, on
the basis that CCTL has failed to fulfil its obligations in respect
of non-transhipment containers for a period of four consecutive
years from 1 December 2003. CCTL has subsequently paid USD 12,047
thousand (2010: USD 14,282 thousand) under dispute in the year
2008. CCTL has commenced legal proceedings at the Chennai High
Court against CPT. Based on advice from the legal counsel,
management believes that the legal proceedings will have no adverse
impact on the Group's financial position; the amount paid is highly
likely to be recovered eventually and will not result in
termination of the license agreement to operate the port.
35 Subsequent event
On 25 January 2012, the Group sold its entire 34% shareholding
in Tilbury Container Services Limited for a total consideration of
USD 75,480 thousand.
[1] Gross throughput is throughput from all our terminals.
[2] Consolidated throughput is throughput from all terminals
where we have control as defined under IFRS.
[3] Adjusted EBITDA is Earnings Before Interest, Tax,
Depreciation & Amortization before separately disclosed items
including share of profit from equity-accounted investees.
[4] On 19 May 2011 DP World undertook a 1 for 20 share
consolidation, the 2010 dividend has been restated to reflect what
the dividend would have been post the share consolidation.
[5] The underlying change shows what growth rates and margin
would have been had the five terminals in Australia continued to be
consolidated in DP World's accounts from 12 March 2011 and allows
for a better comparison to the prior period.
[6] For further information on separately disclosed items see
Note 11 to accounts.
[7] Adjusted EBITDA is Earnings Before Interest, Tax,
Depreciation & Amortisation before separately disclosed items
including share of profit from equity-accounted investees.
[8] DP World undertook a 1 for 20 share consolidation on 19 May
2011. 0.17 cents represented the post consolidation dividend in
respect of 2010. The dividend was paid prior to the share
consolidation at 0.86 of a US cent.
[9] See Note 11 for more details about separately disclosed
items.
[10]Consolidated terminals are all terminals where we have
control as defined under IFRS.
[11]Adjusted EBITDA is Earnings Before Interest, Tax,
Depreciation & Amortisation before separately disclosed items
including share of profit from equity-accounted investees.
[12]The underlying change shows what growth rates and margin
would have been had the five terminals in Australia continued to be
consolidated in DP World's accounts from 12 March 2011 and allows
for a better comparison to the prior period.
[13] The underlying change shows what growth rates and margin
would have been had the five terminals in Australia continued to be
consolidated from 12 March 2011.
[14] Like for like container revenue growth at constant currency
excludes the contribution of Callao (Peru) from January to April
2011 which joined the portfolio in Q2 2010 and Paramaribo
(Suriname) which joined the portfolio in July 2011 and shows what
growth rates and margin would have been like had the five terminals
not been deconsolidated from 12 March 2011.
[15] Consolidated throughput is throughput from all terminals
where we have control as defined under IFRS.
[16] Adjusted EBITDA is Earnings before Interest, Tax,
Depreciation & Amortisation before separately disclosed items
including share of profit from equity-accounted investees.
[17] Like for like revenue growth at constant currency excludes
the exchange rate impact.
[18] Consolidated throughput is throughput from all terminals
where we have control as defined under IFRS.
[19] Adjusted EBITDA is Earnings before Interest, Tax,
Depreciation & Amortisation before separately disclosed items
including share of profit from equity-accounted investees.
[20] Like for like container revenue growth at constant currency
excludes exchange rate impact.
[21] Consolidated throughput is throughput from all terminals
where we have control as defined under IFRS.
[22] Adjusted EBITDA is Earnings before Interest, Tax,
Depreciation & Amortisation before separately disclosed items
including share of profit from equity-accounted investees.
[23] Like for like revenue growth at constant currency excludes
the contribution of Callao (Peru) from January to April 2011 which
joined the portfolio in Q2 2010 and Paramaribo (Suriname), which
joined the portfolio in July 2011, and shows what growth rates and
margin would have been like had the five terminals in Australia not
been deconsolidated from 12 March 2011.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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