AD Ports Group Q2 profit surges on boost from trade through Hormuz alternatives

The Abu Dhabi Ports Group reported a remarkable 86% increase in its net profit for the second quarter, reaching Dh596.7 million ($162.4 million). This surge was primarily due to the company's successful diversification away from the Strait of Hormuz, which has been largely blocked since the onset of the Iran war in February. The company's total revenue grew by 47% year-on-year to Dh7.08 billion, driven by strong performance in maritime services, economic cities, free zones, and logistics.

Despite the unprecedented challenge of operating during the crisis, the company managed to navigate regional disruptions and sustain its profit-enhancing global expansion. Capt Mohamed Al Shamisi, the group's CEO, highlighted the company's landlord port business model, diversification of trade routes, and growing international presence in various countries, all of which played a crucial role in mitigating the impact of the Hormuz closure.

AD Ports has been actively working on alternative multimodal routes and operations under the UAE's national program to strengthen supply chain resilience. The company rerouted cargo operations to Fujairah Terminals and Khor Fakkan Port, expanded regional feeder shipping services to India, Pakistan, Oman, and the Red Sea, and even set up land trade corridors.

It has also increased rail service frequency with Etihad Rail to support operations. In addition to these measures, AD Ports has been busy acquiring new assets to bolster its global network. Recently, it made its largest-ever acquisition by buying an agri-bulk port terminal operator in Brazil, and recently purchased a German logistics services provider.

The company also increased its stake in a Dubai-based logistics company and made an offer for a majority stake in a similar entity in Egypt.