DP World, a port operator based in Dubai, revealed a significant decline of almost 60% in its profits for the first half of the year. This drop was attributed in part to the ongoing attacks by Yemen’s Houthi rebels impacting shipping operations in the Red Sea due to the Israel-Hamas conflict. The company’s profits this year amounted to $265 million, a notable decrease from $651 million during the same period the previous year. Sultan Ahmed bin Sulayem, the chairman and CEO of DP World Group, acknowledged the negative effects caused by the Red Sea disruptions on the company’s revenues.
The heightened geopolitical tensions and disturbances to global supply chains resulting from the Red Sea crisis in 2024 were highlighted by bin Sulayem. While expressing uncertainty regarding the immediate trading outlook due to various macroeconomic and geopolitical challenges, he emphasized the resilient financial performance in the first half of the year, which positions the company favorably to achieve stable yearly adjusted profits. Specific details on the impacts of the Houthi attacks on DP World were not provided by bin Sulayem.
The Houthi rebels have been targeting shipping activities in the Red Sea corridor since November, linked to the Israel-Hamas conflict in Gaza. These attacks have disrupted the transportation of goods worth $1 trillion annually through the area and triggered intense confrontations, unprecedented since World War II, involving the U.S. Navy. The rebels claim their attacks target vessels associated with Israel, the United States, or the U.K. to compel an end to the conflict, even though many attacked ships have no substantial ties to the hostilities.
To avoid the Red Sea disruptions, some shippers have opted to navigate around the Cape of Good Hope in Southern Africa. This rerouting has impacted shipping operations at Dubai’s Jebel Ali Port, which serves as DP World’s headquarters and is considered the world’s largest manmade harbor. DP World had already been encountering challenges stemming from the COVID-19 pandemic, and the effects of the Houthi attacks have further complicated its operations, in contrast to the success experienced by Emirates, a long-haul carrier also owned by the Dubai government.
