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

AD Ports Group, based in Abu Dhabi, reported a significant 86% increase in its net profit for the second quarter of 2023, amounting to Dh596.7 million ($162.4 million). The surge in profit was primarily attributed to the company's diversification efforts away from the Strait of Hormuz, which has been blocked due to the ongoing Iran war.

The company's revenue jumped by 47% year-on-year to Dh7.08 billion, driven by strong performance across maritime and shipping, economic cities, free zones, and logistics clusters. Despite facing the most significant challenge in its 20-year history, AD Ports Group successfully mitigated regional disruptions by leveraging its landlord port business model, diversifying trade routes through the UAE East Coast, and expanding its international port presence in Spain, Pakistan, Egypt, and Angola.

Capt Mohamed Al Shamisi, the managing director and group CEO of AD Ports Group, emphasized the company's ability to sustain its profit-enhancing global expansion amidst the regional disruptions. The company has been actively exploring alternative multimodal trade routes and operations under the UAE's national program to strengthen supply chain resilience, including rerouting cargo operations and feeder services to Fujairah Terminals and Khor Fakkan Port, boosting regional feeder shipping services, and establishing land trade corridors.

AD Ports Group is also expanding its warehousing and storage capacity and procuring additional refrigerated and dry containers. The company's strategic growth initiatives include several acquisitions, such as Corredor Logística e Infraestrutura in Brazil, MBS Logistics in Germany, and increasing its stake in Global Feeder Shipping in Dubai.