DUBAI, United Arab Emirates (AP) — Dubai-based ports operator DP World on Thursday reported a nearly 60% drop in its half-year profit, partly due to ongoing attacks by Houthi rebels in Yemen as part of the war between Israel and Hamas that are disrupting shipping traffic in the Red Sea.
DP World reported a profit of $265 million for this year, compared to $651 million in the same period last year. Sultan Ahmed bin Sulayem, Chairman and CEO of the DP World Group, acknowledged that the disruptions in the Red Sea had affected the company’s revenues.
“2024 is characterized by a deteriorating geopolitical environment and disruptions to global supply chains due to the Red Sea crisis,” he said in a statement accompanying the results. “While the near-term trading outlook remains uncertain due to macroeconomic and geopolitical headwinds, the robust financial performance in the first half of the year leaves us well positioned to deliver stable adjusted earnings for the full year.”
Bin Sulayem did not elaborate on the specific impact of the Houthi attacks on DP World, a state-owned shipping giant that has withdrawn from Dubai’s Nasdaq stock exchange in recent years.
Since November, the Houthis have been attacking shipping in the Red Sea in connection with the war between Israel and Hamas in the Gaza Strip. The attacks have disrupted the $1 trillion worth of goods that flow through the region each year, while sparking the fiercest fighting the U.S. Navy has seen since World War II.
The rebels claim their attacks are targeting ships with ties to Israel, the US or Britain and are part of a campaign to force an end to the war. However, many of the ships attacked have little or no connection to the conflict.
Shipowners have begun to circumvent the Cape of Good Hope off the coast of South Africa to avoid the Red Sea entirely. The diversion is affecting shipping traffic at Jebel Ali Port in Dubai, the headquarters of DP World and the largest artificial port in the world.
DP World, already facing challenges from the coronavirus pandemic, has now been hit by attacks by Houthi rebels, while long-haul airline Emirates, another Dubai state-owned company, has seen a surge in business.
