2013 Dp World Annual Report Accounts

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Annual Report and Accounts 2013

Connectingglobal markets


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DP WORLD IS A GLOBAL OPERATOR

OF CONTAINER AND MARINE

TERMINALS WITH A NETWORK

OF MORE THAN 65 TERMINALS

SPANNING SIX CONTINENTS.


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1 DP World Annual Report and Accounts 2013

http://ar.dpworld.com /2013

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Revenue USD million

09 2,821

10 3,078

11

12

2,978

3,121*

3,073mAdjusted EBITDA USD million

09

10

11

12

1,414m1,072

1,240

1,307

1,404*

Adjusted EBITDA margin %

09

10

11

12

46.0%38.0

40.3

43.9

45.0*

09

10

11

12

295

374

459

545*

Profit attributable to owners ofthe Company USD million

604m

Highlights

FOR MORE ON OUR JOURNEYSEE PAGES 6-7

FOR MORE ON OUR STRATEGYSEE PAGES 14-25

FOR MORE ON CORPOR ATERESPONSIBILITYSEE PAGES 28-41

pg6 pg14 pg28

OPERATIONAL HIGHLIGHTS• 55 million TEU (twenty foot equivalent container units) were handled

across DP World’s global portfolio in 2013

• The first ship called at the DP World London Gateway port, Britain’snew high-tech shipping port and Europe’s largest logistics hub

• Jebel Ali launched its new one million TEU Terminal 2 expansion,welcoming one of the world’s largest container vessels, the MSCLa Spezia

• The lost time injury frequency rate fell by 12% during 2013

• Globally, an 8.7% reduction in our absolute CO2e emissions, whichis equivalent to a 5.8% reduction in KgCO2e/ModTEU was achievedin 2013

• We jointly convened the third Counter-Piracy Conference in Dubaiwhich was attended by over 750 government and industry leadersfrom around the world

• As a premier partner of Expo2020, we supported Dubai’s successfulbid for Expo2020

OVERVIEW1 Highlights2 Chairman’s Statement

STRATEGIC REPORT

4 DP World at a Glance6 Our Journey8 Group Chief Executive Officer’s Review10 Market Review12 Our Business Model14 Our Strategy26 Chief Financial Officer’s Review28 Corporate Responsibility42 Principal Risks and Uncertainties

CORPORATE GOVERNANCE

48 Board of Directors50 Report of the Directors52 Corporate Governance61 Statement of Directors’ Responsibilities

CONSOLIDATED FINANCIALSTATEMENTS

62 Independent Auditors’ Report63 Consolidated Income Statement64 Consolidated Statement of

Comprehensive Income65 Consolidated Statement of

Financial Position66 Consolidated Statement of Changes

in Equity68 Consolidated Statement of Cash Flows69 Notes to Consolidated Financial Statements

FINANCIAL HIGHLIGHTS

Revenue is in USD million before separately disclosed items. Theresults of the Group are set out in detail in the ConsolidatedFinancial Statements and accompanying notes commencing onpage 63.

Profit attributable to owners of the Company is before takingseparately disclosed items into account and excludes any profitattributable to non-controlling interests (minorities).

Growing adjusted EBITDA (earnings before interest, tax,depreciation and amortisation) is a key measure of valuedelivered to shareholders. EBITDA is calculated including ourshare of profit from joint ventures and associates on a basiswhich excludes separately disclosed items.

The adjusted EBITDA margin is calculated by dividing EBITDAby revenue, including our share of profit from joint venturesand associates.

* The Group has restated the 2012 financial statements to reflect the impact of new accounting standards as described in note 3(F)of the Consolidated Financial Statements.


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Chairman’s Statement

DP World is pleased to announce another set of strong financial

results, with like-for-like attributable earnings growing by 26.6%.This performance has been achieved despite the Group facingsome challenging market conditions. Overall, we believe thisrobust set of results illustrates the resilient nature of our portfolio.

Dear Shareholders,I am pleased to report another successfulyear for your Company. Despite theongoing challenges affecting the world’seconomies, DP World delivered profitfor the year of $674 million. This robustperformance reflects our continuedfocus on higher margin revenue andminimising costs, on maintaining a strongbalance sheet, and on making the most ofopportunities to free up capital to re-investwhere it will bring the greatest returns.

Excluding profit from divestmentsand monetisations during the year,the profit attributable to the ownersof the Company was $604 million.

DELIVERING OUR STRATEGY

Our strategy is centred on four priorities:driving sustained long-term shareholdervalue; creating a satisfied and profitablecustomer experience; ensuring ouroperations are efficient, safe and secure;and creating a learning and growthenvironment for our people. Furtherinformation regarding our business modeland strategy, including our achievements

during 2013 and our focus areas for2014 and beyond, are contained in theStrategic Report commencing on page 4.

VALUE FOR SHAREHOLDERS, VALUE

FOR CUSTOMERS

With an average concession life ofaround 40 years, sustaining value is akey driver. We remain confident thatwe can achieve our target of a 15%return on capital employed (ROCE)1 onour existing portfolio and an adjustedEBITDA margin2 of 50% by 2020.

Our investments are focused on ensuringthat we have the right capacity in theright locations and the right services tomeet our customers’ needs today andtomorrow. During 2013, this includedopening for business nearly four millionTEU of new capacity across Jebel Ali(UAE), the DP World London Gatewayport (UK) and Embraport (Brazil). Theopening of additional capacity wassupported by the implementation of thelatest technology across our portfolio tospeed up our customers’ supply chainsand bring goods more swiftly to market.

SUSTAINABLE BUSINESS

Our aim is to be a top-tier global portoperator for decades to come. During2013, our commitment to operatingsustainably for the long-term wasevidenced by the measures we took toimprove safety at our terminals, to reduceour impact on the environment, and toengage with the communities in which weoperate to help stimulate local economies.

The frequency of injuries per million hoursworked, or lost time injury frequencyrates (LTIFR), fell by 12% during 2013. Inaddition, we achieved globally an 8.7%reduction in our absolute CO2e emissionswhich is equivalent to a 5.8% reductionin KgCO2e/ModTEU (per Modified TEU)

3 from our 2012 baseline. We are alsoproud to have been involved in over 230community projects and partnerships

across our portfolio during 2013 andwe were the co-convenor with the UAEMinistry of Foreign Affairs for the third yearrunning of an international public-privateconference on countering maritime piracy.

Further details regarding our commitmentto integrating responsible businesspractices in all aspects of our operationsand across our entire portfolio areincluded in the Corporate Responsibilitysection commencing on page 28.

1 Return on capital employed is EBIT (earnings before interestand tax) before separately disclosed items as a percentageof total assets less current liabilities.

2 The adjusted EBITDA margin is calculated by dividing

EBITDA (earnings before interest, tax, depreciation &amortisation) by revenue, including our share of profit from joint ventures and associates.

3 KgCO2e/ModTEU means the kilograms of carbon dioxideequivalent divided by modified twenty-foot equivalent units.See the environment discussions in the CorporateResponsibility section, commencing on page 28, for fur therinformation.

“OUR PORTFOLIOREMAINS WELLPOSITIONED TOCAPITALISE ON THESIGNIFICANT MEDIUMTO LONG-TERMGROWTH POTENTIAL

OF THIS INDUSTRY.”SULTAN AHMED B IN SULAYEMCHAIRMAN



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In 2013, we were pleased to have ourcommitment to excellent corporate

governance recognised for the secondyear in a row by the S&P/HawkamahESG Pan Arab Index, being named thenumber one listed company acrossa raft of environmental, social andgovernance measures. Further detailsregarding our corporate governanceframework and policies are outlinedin the Corporate Governance sectioncommencing on page 52.

We were delighted to be a premier partnerof Dubai’s Expo2020 bid. Our entire teamwas behind the bid and we are excitedand proud that it was successful. Ourattention now turns to making sure wehave the infrastructure in place to supportthis event, and we will be working veryclosely with our customers to do that. Wealready have tried and tested capabilitiesand we will now take this to the next level.

We look forward to working with Dubaiand the UAE to host the world. Thisevent will not only create opportunitiesfor the UAE, it will also create newopportunities for the countries of theregion and the people of the world.

OUR PEOPLEOur dynamic and committed team of over30,000 people worldwide is the drivingforce of our Company. On behalf of theBoard, I would like to extend sincerethanks to every single member of theteam for their outstanding effort in whatwas an often difficult economic climate.

We continued to invest in our peoplethroughout the volatility of the past fewyears, and we will continue to do so. Byencouraging and supporting innovation,developing the skills and talent of ourpeople and providing them with new

opportunities to excel, we create a workenvironment that is stimulating andexciting, which in turn translates intooutstanding customer service, excellencein operations and a vibrant company.

Further details regarding our people andour commitment to building an inclusive,supportive and safe work environmentare included in the people and safetydiscussions in the Corporate Responsibilitysection, commencing on page 28.

BOARD CHANGES

The close of 2013 saw long-standing Board

member Cho Ying Davy Ho step downfrom his role as an Independent Non-Executive Director. He joined the Board inMay 2007, just a few months before wepublicly listed on Nasdaq Dubai. On behalfof the Board, I would like to thank Davy forhis valuable contribution to the successfulstrategic development of our businessduring his time on the Board. It has beena privilege to have Davy on the Board.

Robert Woods, CBE, was appointed tothe Board from 1 January 2014 as anIndependent Non-Executive Director.

As a former Chief Executive Officer of ThePeninsular & Oriental Steam NavigationCompany, Robert’s considerable experiencein our industry will be of great valueto our organisation as we continue todrive our business forward with stronggovernance and sound counsel, focusedon delivering shareholder value. I verymuch look forward to working with him.

Details of the Directors of theCompany as at 31 December 2013are given on pages 48 and 49.

DIVIDEND

Following the strong performance thisyear, the Board is recommending anannual dividend of 23 US cents per share.This comprises a 10% increase in theordinary dividend to 23 US cents per share.There is no special dividend given therelatively low reported gain on separatelydisclosed items. The growth in the ordinarydividend reflects the Board’s confidencein our ability to generate continuedearnings growth and strong cash flows.

Subject to approval by shareholders, thedividend will be paid on 6 May 2014 to

shareholders on the relevant register asat close of business on 1 April 2014.

OUTLOOK

While the outlook in some regions remainschallenging, we have demonstratedour ability to remain profitable despitethese headwinds. We have made anencouraging start to 2014 and, for theyear as a whole and beyond, we expectto see a return to normalised volumegrowth driven by the addition of newcapacity in our portfolio and a graduallyimproving macro environment. Wecontinue to focus on delivering efficiencies,containing costs and handling highermargin containers to drive profitability.Our business is well positioned for mediumto long-term growth, underpinning ourconfidence in meeting our 2020 target ofan adjusted EBITDA margin of 50% andROCE of 15% on our existing portfolio.

Finally, I am encouraged by and gratefulfor the ongoing commitment of all ourpartners. As we continue our exciting

journey as a leading global terminaloperator, I look forward to sharinganother year of sustained growth

and success with our shareholders.

Sultan Ahmed Bin SulayemChairman

FOR MORE ON OUR PEOPLESEE PAGES 28-41


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DP World at a Glance

DP World Limited is incorporated in the DubaiInternational Financial Centre and is a dual primarylisted company, having been accepted for admission totrading by NASDAQ Dubai in 2007 and to the officiallist of the London Stock Exchange in 2011.

We have a portfolio of more than 65terminals across six continents, includingcontainer terminals, non-container

terminals and new developments in India,Africa, Europe, and the Middle East4.Container handling is our core business andgenerates more than three quarters of ourrevenue. In 2013, we handled 55 millionTEU5 across our global portfolio. Witha committed pipeline of developments

4 All figures regarding terminals and developments are as at 31 December 2013.5 TEU means twenty foot equivalent container units.

and expansions, our capacity is expectedto rise to more than 100 million TEU by2020, in line with market demand.

We operate our portfolio under threeregions:• Middle East, Europe and Africa• Asia Pacific and Indian Subcontinent• Australia and Americas

he DP World London Gateway port (UK)


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In Asia Pacific, we have a network ofeleven terminals in six countries. Wealso have the largest presence of anycontainer terminal operator in theIndian Subcontinent, with five terminalsin India and one in Pakistan. Newdevelopment projects are also underwayin Kulpi and Nhava Sheva (India).

We have a network of fourcontainer terminals in Australia;Brisbane, Sydney, Fremantle andthe country’s busiest and largestterminal at the Port of Melbourne.

Our Americas portfolio consists ofnine terminals across six countries,

including a new developmentthat is now operational atEmbraport, in Santos (Brazil).

Our UAE operations are central to ourportfolio and are comprised of fourterminals, including our flagship facilityat Jebel Ali, one of the largest terminalsin the world. Jebel Ali is undergoingmajor expansion work, with one millionTEU added in 2013 and four millionTEU to be added in 2014, which will

take capacity to 19 million TEU.

In the Middle East, we also operate aterminal in Jeddah (Saudi Arabia). InNorth Africa we operate two terminalsin Algeria in addition to a containerterminal in Sokhna (Egypt), wherewe also have the concession to runa major expansion project. In widerAfrica, we have operations at nineterminals in four countries, includingstevedoring services in South Africa.

We operate a European portfolio ofeleven terminals in eight countries and

have a number of inland terminalsin Northern Europe. Developmentprojects in Turkey, France and theNetherlands are also underway.

MIDDLE EAST, EUROPE AND AFRICA ASIA PACIFIC AND INDIANSUBCONTINENT

AUSTRALIA AND AMERICAS

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From our beginnings in 1972 at Port Rashid in Dubai (UAE), we now have a team of over30,000 people working at more than 65 terminals around the world, including a numberof new developments. Since 2006, we have continued to expand our portfolio throughacquisitions or the winning of new concessions. We remain confident about the long-termoutlook for our industry and we will continue to invest to meet the future capacityrequirements of our customers.

At DP World, we have a heritage to be proud of, growing

from a local port operator, to one with a regional and thenglobal presence.

Our Journey:From Local to Regional to Global Port Operator

1972-1998:

Local port operatorWe evolved from serving local trade inDubai (UAE) starting with the developmentof Port Rashid in 1972, followed inMarch 1979, with the opening of JebelAli port. In 1991, the operations of PortRashid and Jebel Ali port were combinedto create the Dubai Ports Authority.

1999-2004:

Regional port operator

In 1999, Dubai Ports International FZEwas formed to manage and operatecontainer terminals and other facilitiesoutside the UAE, winning concessions inJeddah (Saudi Arabia), Doraleh (Djibouti)

in 2000, Visakhapatnam (India) in2002, Constanta (Romania) in 2003and Cochin (India) in 2004.

2005-PRESENT:Global port operator

In 2005, we acquired CSX World Terminals,a leading global container terminaloperator. In 2006, the acquisition of ThePeninsular & Oriental Steam NavigationCompany (P&O) further increased ourglobal network and market positionin Asia, India, Australia, the Americas,Europe and Africa. DP World was listedon NASDAQ Dubai in 2007 and onthe London Stock Exchange in 2011.


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http://ar.dpworld.com/2013

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Our Journey continued in 2013, withthe DP World London Gateway port

welcoming its first scheduled vessel. InDubai, the one million TEU expansion atTerminal 2 (T2) at Jebel Ali opened to bringcapacity at Jebel Ali port to 15 millionTEU. Our new development at Embraport(Brazil) also became operational in 2013.

2013 also saw construction of theCaucedo Logistics centre begin in the

Dominican Republic and DP World enteredinto a management advisory servicesagreement for the development of theKhorgos Special Economic Zone andInland Container Depot in Kazakhstan.

DP World’s gross capacity reached70 million TEU in 2013 and we

handled 55 million TEU acrossour global portfolio.

2013:

Our Journey continues


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Return on Capital Employed2020 Target†

2013 202020090%

15%

12%

9%

6%

3%

6.7%

15.0%

† Targets based on current portfolio.

0%

50%

40%

30%

20%

10%

46.0%50.0%

Adjusted EBITDA Margin

2020 Target†

2013 20202009

Group Chief Executive Officer’s Review

In 2013, we continued to steer the business through a difficult

macroeconomic environment, remaining focused on highermargin revenues while containing costs and improvingefficiencies across our portfolio.

Driving our strategy with relentless focusover the course of 2013 has resulted inan excellent set of financial results.

We are pleased to report adjustedEBITDA6 of $1,414 million and earningsper share (EPS)7 of 72.8 US cents,which represents like-for-like growthof 9% and 27% respectively. Wealso increased our adjusted EBITDAmargin to 46% as we focused on

higher margin cargo during the year.

Our strong financial performance camedespite slow volume growth. Economicheadwinds combined with a highlyutilised portfolio with limited sparecapacity at key locations constrainedour ability to significantly grow volumes

These projects, consistent with theoverall nature of our portfolio, are long-

term investments, with the life of ourconcessions averaging approximately 40years. Our strong cash flows and solidbalance sheet mean we are well placedto invest today to meet the long-termneeds of our customers, whether it is indeveloped markets requiring increasedefficiencies or the capability to handle theincreasing size of vessels, or in developingmarkets requiring increased port capacityto meet demand or updated infrastructure.

In the developed markets we have investedin the DP World London Gateway port,which offers a state-of-the art facilityto meet the future demands of theindustry. In short, our port provides themost efficient link between deep-seashipping and the largest consumer marketin the UK. We are seeing an increasingnumber of shipping lines calling at ourfacility and since the turn of the year,we have had eight unscheduled calls atthe DP World London Gateway port,including an Asia-Europe service, asour port was less impacted by adverseweather due to its sheltered location.

In faster growing markets we have invested

in the largest multi-modal terminal inBrazil (Embraport), which is in the portof Santos, 80 kilometres away fromSao Paulo, the country’s most populouscity. Our terminal has seen encouragingdemand since opening as the growthof the middle class population in Braziland wider region continues to drivedemand for containerised goods.

In 2014, we look forward to addingfurther capacity at Jebel Ali (UAE) andRotterdam (the Netherlands). We aremaking good progress with Terminal3 Jebel Ali and it remains on track to

deliver four million TEU of additionalcapacity. Rotterdam is on schedule toopen in the second half of 2014.

Alongside investing for the sustainablegrowth of our business, we also continuallyreview our portfolio, disposing of ormonetising assets where it makes strategicsense to do so. In 2013, we monetisedsome of our Hong Kong assets at attractivemultiples, which subsequently reducedleverage and enabled the recyclingof capital into markets that offer thepotential to generate higher returns.

STRONG BALANCE SHEETOur balance sheet remains strongwith leverage (net debt to adjustedEBITDA) at a relatively low 1.7 times.This provides us with the headroom andflexibility to invest further should the

in 2013. However, the addition of newcapacity in 2014 combined with aprojected improvement in global tradesets a promising tone for the year ahead.Our Market Review, commencing onpage 10, highlights the key challengeswe faced in 2013 and industryexpectations for the year ahead.

CAPITAL EXPENDITURE

We continue to invest in our portfolio

for future growth. Over the course of2013, we spent $1,063 million in capitalexpenditure, predominately at ourgreenfield DP World London Gatewayport and logistics park project in the UK,Embraport in Brazil and the expansion ofour flagship Jebel Ali facility in the UAE.


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right opportunities become available.However, we continue to implement strictfinancial discipline across our businessunits, and will only deploy shareholderfunds if investment opportunities meetour internal rate-of-return requirements.

GLOBAL STRATEGY

2013 was also an important year with thecommunication of DP World’s strategythrough a balanced scorecard frameworkwhich comprises four organisation-widestrategic pillars that are core to ourbusiness (corporate responsibility, corporategovernance, communication and strategicimplementation) and four strategic priorityareas to support our mission and valuesand achieve our vision (financial, internal& operational, customer and people &learning). Further details regarding ourstrategy are outlined in Our Business Modeland Our Strategy sections, commencingon page 12 and 14 respectively.

THE YEAR AHEAD

Moving to 2014, our overall financialgoals remain the same. We will continueto focus on higher margin revenueswhile containing costs and improvingefficiencies. We also expect a returnto volume growth driven by a gradualpickup in the macro environment and newcapacity coming on line. Importantly, ourstrong performance in 2013 comfortablypositions us to meet our medium-termtarget of 100 million TEU capacity, an

adjusted EBITDA margin of 50% andROCE of 15% on our existing portfolio.

Further discussion regarding ourGroup financial performance in 2013,including a regional breakdown, iscontained in the Chief Financial Officer’sReview commencing on page 26.

Mohammed Sharaf

Group Chief Executive Officer 6. Adjusted EBITDA (earnings before interest, tax, depreciat ionand amortisation) is calculated including our share of profitfrom joint ventures and associates on a basis which excludesseparately disclosed items.

7. EPS (earnings per share) is calculated by dividing the profitafter tax attributable to owners of the Company (beforeseparately disclosed items) by the weighted average sharesoutstanding.

The DP World London Gateway port (UK)

FOR MORE ON OUR CONSOLIDATEDFINANCIAL STATEMENTSSEE PAGES 63-114


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Market Review

For the global economy, 2013 was largelydominated by continued uncertainty.Many of the world’s major economiesshowed signs of start-stop growth, whichcontinued to impede progress towards amore broadly supported growth trajectory.

Once again, emerging and developingeconomies provided much of the growthin 2013; however the pace was noticeablyslower than in previous years. This wasespecially visible in the recently thrivingBRIC countries8, evidencing that they areby no means immune to market volatility.

Whilst this played out, what became clearwas the gradual emergence of a new andsizeable middle class in many developingcountries that has begun to engage withthe global market. With 90% of trade byvolume transported by sea9, the growingpurchasing power of this demographicprovides an ongoing positive boostfor the container shipping industry.

For the shipping lines, 2013 was anotherdifficult year. 2013 growth in containershipments is expected to be lower thanrecent years at 4%10 implying a GDPgrowth multiplier of 1.4 times. Even withrecord removal of container vessel tonnage,shipping capacity additions have againoutstripped growth in demand, a trendapparent in six of the past eight years. Thishas predictably led to an overall declinein freight rates for the shipping lines.

Importantly, the additions in shippingcapacity in recent years have been greatlyweighted towards ultra-large containervessels, which have been specifically

The growth in vessel size has resulted in an increased focus on

sustainable operations and operational efficiencies, including theneed for robust terminal equipment, systems and processes ableto cope with the new ultra-large container vessels and theadditional requirements of greater loads at peak periods.

8 BRIC countries include Brazil, Russia, India and China.9 International Chambers of Shipping – Sustainable

Development IMO World Maritime Day 2013.10 Alphaliner Monthly Monitor, February 2014.11 Drewry Annual Review of Global Container Terminal

Operators, 2006 and 2013 editions.

designed for increasingly superior fueleconomy and lower unit costs. Theintroduction of these new vessels ontothe main east-west routes means olderlarge vessels are cascaded onto secondarytrades, sometimes doubling capacityon a service overnight. Whilst this ispart of the natural evolution in revisednetworks, it has meant that many formerlyprofitable routes have also experiencedlarge fluctuations in liner freight rates.

The shipping lines’ response in 2013 tothe pressure on rates was consolidationthrough partnerships. The announcementof ‘P3’, a vessel-sharing agreement onthe Asia-Europe, Trans-Pacific and Trans-Atlantic trades between the three largestcontainer shipping lines in the world, ledswiftly to the ‘G6’, a partnership betweentwo of the three major alliances (the GrandAlliance and the New World Alliance)as well as ongoing discussions betweenthe third alliance which comprises SouthKorea’s Hanjin Shipping, ‘K’ Line of Japan,Taiwanese line Yang Ming and China’sCosco, known as CKYH, and the fewremaining non-aligned major carriers.

Customer consolidation is leading tostep changes in capacity utilisation ratherthan gradual changes because any gainor loss is across a partnership of severallines. Reduced economic growth, inparallel with the increased consolidationof business, has meant that competition

amongst container terminal operatorsto gain new vessel calls has increased.

For DP World, the impact of these trendshas been largely positive because ofour geographical spread and ongoinginvestment in infrastructure and equipmentto enable us to handle the larger vessels.Our terminal capacity utilisation continuesto outpace the industry and with thisevolution of the customer networkwe will aim to continue this pace.

We maintain a geographical advantagewith our broad portfolio stretchingacross both developed and developingcountries, primarily focused on the coreorigin and destination markets. This,aligned with judicious acquisitions, timelycapacity developments and consistentinvestment in new equipment andtechnologies, has enabled us to growgross volumes by an average of 17%per annum since 2004; more thantwice the average annual growth inthe market over the same period11.



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OUR BUSINESS – MACRO OVERVIEW

• Contributes to a country’s GDP: byconnecting markets, ports cut living costsand raise living standards.

• Reinforces trade relationships:

approximately 90% of the world’smerchandise and commodity trade istransported by container vessels12.

• Supports economic diversification:the ports and transportation industrysupports economic diversification byaiding the growth of other sectors.

• Container vessel transport:approximately 60% of the value ofglobal seaborne trade (more than $5.6trillion13 worth of goods annually) istransported by container vessels.

• Globalisation: global increases in percapita income and reduced trade barrierspromote an increase in tradable goods.

• Rapidly developing economies:the emergence of new, faster growingmarkets, with young growingpopulations who have considerablepurchasing power, is driving growth.

• Generates employment: for every job created inside a well-run port,up to five jobs are created outsidethe port.

• Builds local knowledgeand expertise: the portsand transportation industry buildslocal knowledge and expertisethereby increasing a country’sfuture competitiveness.

• Urbanisation and emergence ofmega cities: within a decade, 47%of the world’s urban population willlive in cities with more than one millioninhabitants14. Increasing port capacity

and infrastructure will be required tohandle this concentrated populationand container volume.

• Containerisation: the rate ofcontainerised goods is increasing.

• Customer demands: customersare demanding that ports achievehigher productivity levels and havethe infrastructure in place to caterfor larger vessels.

12 International Chambers of Shipping – SustainableDevelopment IMO World Maritime Day 2013.

13 World Economic Fo rum – The Global Enabling TradeReport 2012.

14 World Economic Fo rum – Capturing The Future 2012.

• Stable and long-term cash flow: we

focus on stable origin and destinationcargo as it delivers higher margins andis less impacted by competition thantranshipment cargo. We also operateour business through long-termconcessions, enabling better returnsas our assets mature.

• Growth rates: a focus on fastergrowing emerging markets and moreresilient origin and destination cargoenables us to grow volumes acrossour portfolio.

• High barriers to entry: our long-termconcession agreements provide high

barriers to entry and support long-termrelationships with port authorities,shipping lines and joint venture partners.

• Global network, managed locally:

our terminals are managed locally,and are supported operationally bythe advantages of a global network.

• World class operations: weare market leaders in automatedtechnology with exceptionalstandards of operational performanceand productivity.

• World class employees: ourdedicated, experienced and innovativeteam serves customers in some ofthe most dynamic economies aroundthe world.

• Recognised brand: we are a

recognised brand for delivering excellentcustomer service, with a commitmentto good corporate governance andcorporate responsibility.


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“OUR BUSINESS ISWELL POSITIONEDFOR GROWTH AND

WE BELIEVE WEARE WELL PLACEDTO CONTINUE TOOUTPERFORMTHE MARKET.”MOHAMMED SHARAFGROUP CHIEF EXECUTIVE OFFICER

We continually invest in terminalinfrastructure leading to increasedefficiency and profitability withinthe Group’s terminals. With theexpansion of existing terminals anda pipeline of new developments, weare contributing to economic growthand development around the world.

We believe our business will continue todeliver long-term value to our shareholdersas it offers stable and long-term cashflows, relatively high growth rates,high barriers to entry, a global networkwhich is managed locally, and worldclass operations and employees.

We recognise good corporate governanceand corporate responsibility as key enablersthat guide our activities and they areembedded within our values. In additionto the movement of cargo, we work withthe governments, and the communitiesthat they serve, in order to make animpact and support the community.

Our people are our most importantasset and we are committed topromoting a workplace that encouragescontinuous learning and growth forall, with a culture where innovation,collaboration and superior performanceare a recognised and celebrated partof who we are and what we do.

We are also committed to working closelywith our customers and joint venturepartners to deliver quality services todayand to have innovative solutions for theneeds of customers tomorrow. Whetherit is planning for new developments suchas enabling ports to handle the nextgeneration of ultra-large container vesselsor improving the reliability and efficiencystandards to handle more containerssafely, we are a global business partner.

We are a global operator of container and marine terminals.

Our aim is to enhance the supply chain efficiency of ourcustomers by effectively handling container, bulk and generalcargo across our network.

Our Business Model

DP World Jebel Ali (UAE)


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15 World Economic Forum – The Global Enabling TradeReport 2012.

Maximising shareholder value

From a macro global perspective, the portsand greater transportation industry servesas a vital economic lifeline and gatewayto a country by supporting economicgrowth and prosperity. By efficientlyservicing vessels crossing the world’soceans, ports play a significant role incontributing to a country’s GDP, reinforcingtrade relationships, supporting economicdiversification, building local knowledgeand expertise to increase competitivenessand also generating employment.Container vessels transport around 60% ofthe value of global seaborne trade, morethan $5.6 trillion worth of goods annuallyand around 90% of trade by volume15.

Key influences driving the growth of ourindustry include globalisation, rapidlydeveloping economies, urbanisation, theemergence of mega cities, containerisation,greater operational efficiency and changingcustomer demands. We develop andadapt our strategy and our business totake into account these global trendsand their impact on our industry.


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Our Strategy

Our strategy describes our plan to maximise shareholder value

through leveraging our portfolio of world-class infrastructureassets, to strengthen global supply chains and to generatesustainable economic growth.

Strategic pillars Strategic priorities

DP WORLDGLOBAL STRATEGYROAD MAP

Our Vision looks to our future. It givesdirection to where we are going andwhat we want our Company to become.

Our Mission describes our purpose. Itsays what we exist to do and how thistakes us towards achieving our Vision.

Our Values are the common principlesthat shape our culture. They describe“how we do things” at DP World.

Our VisionSustainable value throughglobal growth, service andexcellence.

Our MissionA global approach to a localbusiness environment whereexcellence, innovation andprofitability drive our corebusiness philosophy ofexceptional customer service.

Our Values• Commitment to our people

and our customers• Profitable global growth• Responsible corporate and

personal behavior• Excellence and innovation

OUR STRATEGY

As we evolve and live in a moreintegrated world, we have to constantlyadapt to the changing environmentand our customers’ needs. Our strategytherefore has to be flexible to thechanging dynamics, whilst providing clear

guidance on how to achieve our vision.

In 2013, we introduced the conceptof the balanced scorecard frameworkto communicate DP World’s strategy,with the aim of communicating a clear,consistent and shared vision of DP Worldfor a sustainable future. The frameworkprovides measurable guidance and targetsfor DP World over the medium and long-term, and uses key performance indicators(KPIs) to measure the implementationof the strategy across the portfolio.

The next section describes DPWorld’s global strategy road map.

Our global strategy is communicated via two avenues: Our Vision, Mission and Values and the DP World balanced scorecard

framework. Our Vision, Mission and Values define our purpose, the means to achieve our purpose and the principles that drivebehaviour at our Company.

P e o p l e

a n

d l e

a r n i n

gC u

s t o

m e r

I n t e r n a

l / O p e r a

t i o n a

l

F i n a n c i a l

r e s ponsi b i l i t y

C o m m uni c a t i o n

i m p

l e m e n t a t i o

n

VisionMissionValues

C orpor a t e

C o

r p o r a t e S

t r a t

e g

i c

g o v e r n a n c e


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Internal/OperationalDeveloping efficient, safe and securemethods of managing our operations

People and LearningCreating a learning and

growth environment

FinancialDriving sustained long-term

shareholder value

CustomerCreating a satisfied

and profitablecustomer experience

DP WorldBalancedScorecard

The DP World balanced scorecardframework defines strategic pillarsto be implemented across theCompany and strategic prioritieswhich are measured against KPIs.

STRATEGIC PILLARS

Our organisation-wide strategicpillars define objectives that applyand need to be implemented acrossthe regions and business units in ourGroup. They align our business to builda more sustainable business model,develop robust risk and complianceprocesses, communicate effectively toall stakeholders and implement ourstrategy. They are comprised of:• Strategy Implementation:

communicate key messages and definemeasurable performance milestones.

• Corporate Governance: ensure goodcorporate governance and adherenceto international best practice.

• Communications: enhance internaland external communications.

• Corporate Responsibility: buildand sustain strong communitiesthrough strategic communityinvestment, to leave a sustainablelegacy and to take the lead inbeing a good corporate citizen.

STRATEGIC PRIORITIES

Our four strategic priorities tell thestory of our strategy and describe howwe create value for our stakeholders,by focusing on the following:• Financial Priorities: driving sustained

long-term shareholder value.

• Customer Priorities: creatinga satisfied and profitablecustomer experience.

• People & Learning Priorities: creatinga learning and growth environment.

• Internal & Operational Priorities:developing efficient, safe and securemethods of managing our operations.

Our four strategic priorities are explainedin further detail in the table and casestudies to follow, including an outline ofour achievements during 2013 and KPIs.


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2013 ACHIEVEMENTS

wall by 400 metres to 3,000 metres,allowing for the simultaneous handlingof six ultra-large container vessels.

• We opened the c. $2.3bn DP WorldLondon Gateway port and logisticspark project (UK) on schedule inthe fourth quarter of 2013.

our customers’ competitivenessand lowering supply chain costs.

• We jointly announced with Marksand Spencer the building of a newc. $300 million distribution centre atthe London Gateway logistics park,which will give Marks and Spencercloser access to key UK cities andaccess to the rail network being built.

• We inducted almost 5000 truck driversinto our safety programme for externaltruck drivers at Jebel Ali port (UAE)as part of our priority to provide asafe and secure work environment.

• We implemented the methodologyof scenario planning to strengthenour ability to think through futureenvironments and ensure our strategyis best placed to take advantage ofa changing world. The “DP WorldGlobal Scenarios 2040” bookletwas launched in December 2013.

gain a better understanding of the keydrivers that engage our people. Thesurvey was conducted in 26 languagesand we received over 16,000 responses.See page 36 for further informationregarding the My World survey results.

Our Strategic Priorities

FOR MORE INFORMATIONSEE PAGES 18-19





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Return on Capital Employed

09 3.8%

10 4.4%

11

12

6.0%

6.8%

6.7%

Gross Capacity mTEUGross Capacity Utilisation %

0973%59.7

1077%64.1

11

12

79%69.4

80%69.7

70.7 / 80%

■ Gross Capacity Utilisation (%)■ Gross Capacity (mTEU)

Increase in Gross Berth Moves Per Hourcompared against our 2008 baseline

09 3%

10 5%

11

12

10%

12%

13%

2013 DP World Institute Training Programmes

6416

27040

18789

Asia Pacific & Indian Subcontinent

Middle East, Europe & Africa

■ Operations■ Leadership

Australia & Americas

Earnings Per Share (US cents) exc SDI

09 35.6

10 45.0

11

12

55.3

65.7

72.8

Lost Time Injury Frequency Rate

09 10.1%

10 8.8%

11

12

8.0%

7.3%

6.4%

My World Employee EngagementSurvey Response Rate

09

11

75%

77%

77%

■ 17% Maintenance

■ 49% New facilities■ 34% Existing facilities

2013 Capital Expenditure

KEY PERFORMANCE INDICATORS

ROCE (return on capitalemployed) is EBIT beforeseparately disclosed items as apercentage of total assets, lesscurrent liabilities.

Our ROCE is impacted by thevery low age profile of ourportfolio and the up frontcapital investment required.ROCE has almost doubled inthe last four years and we aremaking good progress towardsour target of 15% on ourexisting portfolio by 2020.

EPS (earnings per share) iscalculated by dividing theprofit after tax attributableto owners of the Company(before separately discloseditems) by the weighted averageshares outstanding.

In 2013, our EPS grew 27% ona like-for-like basis, displayingour ability to target highermargin cargo, improveefficiencies and maintain costs.

$1,063 million of capitalexpenditure was investedacross our portfolio in 2013,with a significant proportioninvested in our DP WorldLondon Gateway port (UK) andJebel Ali port (UAE).

Our capital expenditure in 2013was predominantly targetedat new facilities and theexpansion of existing facilities.

By offering a market-leading portfolio of products and tools, the DP WorldInstitute team exists to add value to the business by meeting our customer’sneeds and by enabling our people to meet their true potential.

GBMH (gross berth moves perhour) is calculated by takingthe total container vesselmoves, divided by the sum ofthe gross crane hours (wheregross crane hours is the timefrom first lift to the last lift ofeach quay crane combined).

We have calculated the GBMHas an average across ourportfolio and the above graphshows our GBMH improvementas a percentage against our2008 baseline.

We recognise the need tohave a solid understanding ofthe attitudes and opinions ofour people and understandthe relationship betweenemployee engagement andbusiness performance. Wemeasure these key indicatorsbi-annually through our MyWorld employee engagementsurvey. In 2013, a 77% responserate from staff at participatingbusiness units was achieved.Over 16,000 responses werereceived in 2013.

LTIFR (lost time injuryfrequency rate) is thefrequency of injuries permillion hours worked.

DP World is committed toensuring the safety of ourpeople and we will continueto strive towards achieving ourgoal of zero harm.

Gross capacity is the totalcapacity from our globalportfolio of over 65 terminals.Gross capacity utilisation is thetotal throughput divided by thetotal capacity.

Our portfolio remains highlyutilised and above the industryaverage.


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At DP World we actively manage ourportfolio and our finances with twoprincipal strategic aims in mind: tomaintain the diversity of our network ofterminals globally, focusing on maximisingfinancial returns from our business; and toensure we have a strong balance sheet.

During 2013, we took the opportunity tostrategically adjust our portfolio, divestingand monetising some Hong Kong assetsand recycling capital into faster growingmarkets and new developments, includingJebel Ali (UAE), Embraport (Brazil),Rotterdam (the Netherlands) and theDP World London Gateway port (UK),which are all investments for the future.

FinancialTo ensure we retain our status as an attractive and competitive business forinvestors, we must drive sustained long-term shareholder value.

Our Strategy in Action

We undertook two linked transactions inHong Kong, a relatively mature market,with the first being the divestment ofour CT8 terminal. At the same time weentered a strategic partnership withthe Hong Kong arm of the Australianheadquartered Goodman Group, whichdevelops and manages industrial andcommercial business space, to monetiseour second Hong Kong terminal,known as CT3, and the giant logisticsfacility ATL, which is located alongsideCT3. We retain a 25% ownership ofthose two assets as well as retainingmanagement and oversight of CT3.

KEY GOALS AND TARGETS

We set challenging financial targetsto drive optimised productivityand to deliver sustainable value.Our terminals contribute to our

financial performance by:• increasing asset utilisation;• increasing productivity;• reducing costs; and• increasing current and new

sources of revenue.

By actively managing our global portfolioand ensuring access to the best sourcesof capital for the long-term, we manageour leverage and investment gradeto ensure we remain competitive.By operating our terminals throughlong-term concessions and strategicallyinvesting in value-adding terminals

where we have management control,we manage our portfolio by strategicallyinvesting and divesting to maximisevalue for tomorrow and beyond.

Hong Kong CT3 (China)

“OUR AIM IS TOMAINTAIN ORINCREASE OVERALL

MARKET SHARE BYBEING IN THE RIGHTLOCATIONS ANDOFFERING THE RIGHTPRODUCTS TO OURCUSTOMERS. WHENENTERING OR EXITINGMARKETS, WE DOSO WITH STRICT

FINANCIAL CRITERIAAND A CONSIDEREDAPPROACH.”YUVRAJ NARAYANCHIEF FINANCIAL OFFICER


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Driving sustained shareholder valueThe transactions were achievedat compelling multiples with thetotal consideration paid for the twotransactions being $742 million, witha net gain of approximately $152million. The transactions were alignedwith our strategic goals and direction,reducing leverage and allowing us toreinvest capital into other markets.

The Hong Kong transactions built on thedivestments and monetisations of 2012,which saw us exiting non-core businesseswith low returns, small joint ventures andterminals where we had little operationalcontrol or were a minority shareholder.

Over the past two years, we have divestedapproximately 3.9 million TEU capacity,however, our investment pipeline willhave added more than 10 million TEU toour global capacity by the end of 2014.

These activities have resulted in usmaintaining the shape of our businesswith around 70% of the cargo we handledestined for or originating from the marketour terminals serve (origin and destinationcargo), and three quarters of our businessin emerging markets, which have greatergrowth potential than mature markets.

It has also meant that we havesignificantly reduced our net debtto adjusted EBITDA to 1.7 times,compared with 2.0 times in 2012.

At the same time as maximising the valueof our existing portfolio, we maintained adisciplined approach to new investmentsduring 2013. We have stringent investmentparameters in place that require areturn on capital employed of 15% overthe life of any project we invest in.

Our aim is to maintain or increase overallmarket share by being in the right locationsand offering the right products to ourcustomers. When entering or exitingmarkets, we do so with strict financialcriteria and a considered approach. Withan already well-diversified network, thefocus in 2013 was to grow capacity inexisting terminals and developments. And

since ours is a long-term business, wemake sure we match our debt profile toour long-term objectives, avoiding short-term liabilities and maximising returns forour shareholders today and tomorrow.


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Our new c. $2.3 billion DP World LondonGateway port and logistics park projectin the UK is a standard bearer of ourcustomer strategic priority. Now openand trading, the terminal is the UK’s first21st century major deep-sea containerport and Europe’s largest logistics park.

Operated by DP World on the northbank of the River Thames, it providesunrivalled shipping access to the largestconsumer market in the UK. It willoffer cost reductions for businessesthat want to ship goods closer to theconsumer, rather than having the goodstransported further than necessary bytrucks. In essence, it is saving Britishbusinesses time, money and reducing theCO2 emissions in their supply chains.

Consultation with stakeholders was a keyfeature of this project. A series of customervisits and receptions throughout the UKand in Asia have all raised the profileof the port and its advantages. Publicadvocacy programmes reached out tocustomers such as DB Schenker, FreightLiner, Maersk Line and MOL. Politicalfigures also visited the site, including BritishPrime Minister David Cameron, as havepotential port users; from companies ofall shapes and sizes to trade associations.It was also critical for the sustainability ofthis project that we engaged positivelywith the surrounding communities. Fromthe beginning, we consulted with the

local communities to engage them inthe project and receive their feedback.

In line with the port being completedand additional jobs being created, theteam continued to engage with localuniversities and colleges in 2013 toinform young people in the local andwider communities of the exciting andfulfilling careers available at the port andthe opportunities more widely availablethroughout DP World’s global portfolio.

Our stakeholder and customer-focused commitment evidenced by thedevelopment and operation of the DPWorld London Gateway port and logisticspark is already delivering results. Theport received its first ship in late 2013,the MOL Caledon from South Africaand also announced a c. $300 milliondeal with Marks and Spencer for a majornew distribution centre providing easieraccess to London and the South East.

Stakeholders and industry expertsare already taking notice:

“London Gateway offers the potentialfor JLR to gain competitive advantageby integrating consolidation anddistribution flows through the port.We already import and export a lotof material, and we’re growing, sothere will certainly be opportunities.”Andy Gallon, InternationalManufacturing DevelopmentManager, Jaguar Land Rover.

“Our members feed the nation – includingthe capital. We see London Gatewayas a potential food hub for London,enabling us to deliver on day one forconsumption on day two, which wouldmean extended shelf life for productsand supply chain cost savings for ourcustomers.” Chris Sturman, CEO, FoodStorage & Distribution Federation.

For stakeholders, the added value ofunparalleled tidal access to the UK aswell as superior efficiencies is clear. Fromthe moment a ship arrives at the portthere will be minimal downtime for acustomer’s cargo with the use of innovativeoperational techniques and technologiesbuilt on the backbone of our global,proven and tested operational practice. TheDP World London Gateway port will deliveran unprecedented level of automatedproductivity to the container deliveryprocess, including automated loading ofheavy goods vehicles, with traffic flowsmanaged using industry proven vehicle

booking systems. Other novel featuresinclude an increased tidal window allowingit to stay open even in severe weather.

CustomerOur customers’ needs are constantly changing. This means we have toanticipate these changing needs and be agile with our response so thatwe deliver a satisfied and profitable customer experience.



To continue to be a leader in quality andreliability we will:• continually develop and innovate

services that offer superior

performance for our customers;• deliver value for money on time;• deliver the right capacity to

meet the right demand; and• enhance value-adding services both

inside and outside the terminalto grow ancillary revenue.

As part of our aim to deliver a satisfiedand profitable customer experiencewe will also develop and growsustainable, high-value customerrelationships and provide access to aglobal network. Through this focus,we will be known as a trusted brand

that can be relied on by our customersto deliver at all of our locations.

“LONDON GATEWAYIS A FANTASTIC

PROPOSITIONAND A PERFECTOPPORTUNITYTO DESIGNCOLLABORATIVESUPPLY CHAINS.”PETER SURTEESEUROPEAN SUPPLY CHAIN DIRECTOR,KIMBERLEY-CLARK


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Providing

access globally

The DP World London Gateway port (UK)and our flagship Jebel Ali port (UAE) areunique in our portfolio of more than 65terminals and new developments. Theyare both purpose built from greenfieldsites, both deep water ports able tohandle the new generation of ultra-large container vessels, both adjacent tohuge logistics parks, and both using themost modern information technologyto manage the handling of containers.

Ports take time to build and are asignificant investment, planned withlong-term horizons. We did not buildthe DP World London Gateway port andlogistics park solely for today or eventomorrow. It has been built for futuregenerations. It will support British tradeand the UK economy far into the future,and it will bring jobs to the local and

wider community as businesses flourish.


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Our dynamic and committed team of over30,000 people are our greatest asset.By investing in and enhancing the skillsand knowledge of our people throughworld class training programmes, wewill continue to build an outstandingand high-performing team.

We believe in developing the talent andpotential of our people through ongoingtraining not only at their home terminalsbut elsewhere in our network. We runcross-training programmes across ourglobal portfolio so individuals have awide range of experience in differentoperational environments. For example,team members from DP World Dakar(Senegal) have received training in the UAEand Djibouti, while staff at Embraport,our new development in Brazil, havebeen trained at DP World Callao (Peru).

This reflects our belief in moving staffaround our network to gain moreexperience before they return to theirhome terminal to apply the skills andshare the knowledge that they haveacquired internationally. This cross-trainingenhances our skilled workforce, whichin turn optimises our business efficiencyfor the benefit of our stakeholders.

Abdou Niane Ndiaye is living proof thatinvestment in providing training acrossour network of marine terminals pays off.Abdou comes from Dakar in Senegal and

joined DP World as a gantry crane operatorat DP World Dakar in 2008. After attendinga training course at the Company’sJebel Ali terminal, he has moved on tobecome a fully qualified trainer himself.

Abdou observed that his experienceis an example of how the approach totraining on the job in different locationsgives local employees a broadercareer path and provides them withthe technical know-how to pass onto others in their home country. Theinvestment in people has paid off.

We have a myriad of learning anddevelopment initiatives that we useglobally. During 2013, we deliveredplanning terminal operations workshopsacross our network with state of theart simulation software so participantscan understand how vessel, yard andequipment operations can be improved.

Our leadership framework was also furtherdeveloped using a range of globallyrecognised academic experts to deliver amulti-lingual leadership learning curriculumaligned with organisational priorities andthe needs of employees at different levels,from terminals, regions and head office.

Our iLearn web-based learningmanagement system offers eLearningcourses, tutor-led webinar sessionsand work-based assignments withgreater flexibility and more realisticworkplace situations. Collaborativelearning is encouraged through theuse of iPads to access both genericand bespoke learning material, usingsocial networks and applications todeliver paperless learning experiencesand personalised video messaging.

Part of the approach includes our ongoingsupport for local training activities andthe well-established advanced trainerand assessor programme, with expertadvice to terminals and port authoritieson setting-up operational training

centres that feature best practiceprocesses with learning materialsoffered to the wider port communityin the markets in which we operate.

Our people are fundamental to oursustained success. Contributing to theirlearning and development supports ourCompany’s superior performance. We willcontinue to focus on the developmentof our people and foster a companyculture where innovation, collaborationand performance are a celebrated partof who we are and what we do.

People and LearningIn a workplace that encourages continuous learning and growth for all, we willcreate an environment where innovation, collaboration and performance are arecognised and celebrated part of our culture.



We aspire to be an employer of choicewith a competitive reward scheme thatrecognises outstanding performance,and we aim to maintain employee

retention levels that are above theindustry norm. We achieve this:• through the formal

management of an innovative,performance-driven culture;

• recruiting and retaining a skilledworkforce that is able to meetthe needs of our business; and

• succession planning forall critical roles.

By promoting the DP World culturewe will:• ensure leadership styles are aligned

to the DP World leadership pillars;

• encourage open feedback aspart of promoting an openenvironment that supportsinnovation and collaboration; and

• encourage innovation acrossall aspects of our business.

We will also provide an environment thatencourages learning and collaborationto:• foster continuous learning, including

using technology to support learningacross our global portfolio; and

• promote the sharing of informationand statistics to ensure the consistentapplication of Human Capitalpolicies and procedures globally.


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Encouraging

continuous learning

Training centre at DP World Jebel Ali (UAE)


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Efficiency, safety and security are keyelements in sustaining our long-termgrowth and maintaining our operationalexcellence. Ensuring cost containmentand safety supported by automationtechnology and innovation is somethingthat our customers expect, reinforcingour reputation for providing premierservices. We achieve this by harnessing thecollective knowledge and experience acrossour global portfolio, exchanging bestpractice and knowledge sharing, keepingup to date with the latest technologicaladvances in our industry and cascadingthat information across our network.

These ingredients all contribute to greaterefficiency. With regional collaboration, ourvarious Head Office departments also getinvolved to ensure we are closely aligned.With regular terminal visits and inspectionswe reinforce compliance with our globalpolicies and verify that operational servicelevels meet the standard for terminalconfiguration and customer satisfaction.By monitoring and benchmarkingterminal performance and capacitythrough well-defined key performanceindicators we can better identify whenadditional capacity is required to meetthe future needs of our customers.

From automated remote controlled quaycranes to optical character recognitionsystems for containers, we implementtechnological advancements that will

improve our efficiency which in turnbenefits our stakeholders. A rolling seriesof workshops with users of our terminalsystems, also makes sure there is acontinuous focus on quality assurance andimproving productivity at our terminals.

The best operations model in the industryis a centralised system, with the terminalcontrol centre at its heart supported bythe terminal operating system (TOS).

Traditionally such systems are built arounda container. We are building ours aroundequipment because that is what drives ourefficiency and effectiveness. Until now wehave primarily used third-party TOS but weare currently developing an in-house TOSwith multiple smart applications and add-ons to optimise performance. The systemis already up and running in Suriname,Tarragona (Spain), Hong Kong (China) anda number of our African ports with plans toimplement it in Laem Chabang (Thailand),one of the larger terminals in our network.

Our future aim is to have all knowledgeand optimisation embedded inone platform so that we can takeadvantages of integrated and centralisedasset management utilisation.

During 2013, we launched the industry’slargest ever asset managementprogramme, bringing together ouractivities into a harmonised risk basedmanagement system approach stronglyaligned with our strategic objectives. Thiswill be compliant with the ISO 55000standard for asset management.

Port equipment is by its nature expensiveand therefore requires careful handling.If all our assets are managed across theglobal portfolio rather than on a terminalby terminal basis, we can greatly improveefficiency, eliminate waste and duplication,cut costs, and minimise disruption to

customer service. Five terminals havealready trialled the programme withanother eight scheduled to join in 2014.

Our initiatives under the umbrella ofoperational excellence also bring benefitssuch as reducing the amount of carbonemissions, faster vessel start up, a shorterequipment cycle, faster shift changesand faster gate transactions matchingdemand with supply so we can servicecustomers better, faster, and safer.

Internal/OperationalTo sustain our long-term global growth we must ensure we developand continuously improve efficient, safe and secure ways of managingour operations.



Developing efficient, safe and securemethods of managing our operations by:• providing a safe and secure

environment and contributing

to a sustainable environment;• growing revenue profitably by

excelling in customer service, retainingexisting customers and targetinga pipeline of new customers;

• growing sustainably andprofitably, winning projects inmarkets with strong economicgrowth drivers and focusing onorigin and destination cargo;

• managing risk intelligentlyand optimising opportunities,reducing operations downtimeand non-operational risks, andoperating in compliance with

applicable laws and regulation;• focusing on operational excellence

and extracting the maximum valuefrom our resource base which resultsin increased cost productivity; and

• creating the culture and infrastructureneeded to encourage innovationthrough research and development.


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S T R AT E GI C

R E P OR T

As customers order larger vessels and seek world class ports tohandle them, development of port infrastructure is becominga major requirement in the industry. Our flagship port at JebelAli (UAE), already able to handle the world’s largest vessels, ispreparing to be able to serve ten ultra-large container vessels atthe same time. In December 2013, the first four of 19 ship to

shore quay cranes arrived for the new four million TEU ContainerTerminal 3 (T3) at Jebel Ali.

With their 69.5 metre lifting height and extended reach, the newcranes can handle the new generation of 25 container-wideultra-large container vessels. There will be 98 quay cranes in totalat Jebel Ali once all cranes on order are in place. T3, which isdue to open in 2014, will increase the total capacity of the portto 19 million TEU.

Continuously improving efficiency

Rotterdam World Gateway (the Netherlands)


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Chief Financial Officer’s Review

In 2013, we achieved adjusted EBITDA of $1,414 million, while adjusted EBITDA margins reached a new high of 46%. On a like-for-likebasis the growth was solid with adjusted EBITDA and EPS growing by 9% and 27% respectively, driven by margin growth in our MiddleEast, Europe and Africa region.

2013 revenues grew by 3.6% on a like-for-like basis, despite reporting a 0.5% decline in like-for-like consolidated volumes, whichillustrates our ability to target higher margin cargo. Our 2013 like-for-like gross volumes grew marginally by 0.7%, due to a combination ofbeing capacity constrained at key locations, including Jebel Ali (UAE), and tougher operating environments in the Asia Pacific and IndianSubcontinent region, particularly in the first half of 2013. After a difficult start to 2013, we were encouraged by our volume improvementand a strong second half of the year resulted in marginal full year volume growth.

MIDDLE EAST, EUROPE AND AFRICA

Results before separately disclosed items2013

(US$m)2012

(US$m) % change

Like-for-likeat constantcurrency %

change

Consolidated throughput (TEU ‘000) 18,993 19,202 (1.1%) 0.4%Revenue 2,124 2,112 0.6% 4.4%Share of profit from equity-accounted investees 8 24 (65.2%) 2.6%Adjusted EBITDA 1,095 1,021 7.3% 10.1%Adjusted EBITDA margin 51.6% 48.3% – 52.7%16

Market conditions in the Middle East, Europe and Africa region were mixed. Resilience in our UAE and Africa portfolio mitigated theweaker markets elsewhere. In fact, the UAE delivered another record year with throughput reaching 13.6 million TEU despite beingcapacity constrained at the start of the year. Consolidated throughput for the region was down 1.1% for the year, but our revenue grew4.4% on a like-for-like basis as our cargo mix favoured higher margin origin and destination and non-container traffic, particularly in the

UAE. This translated into a strong financial performance with adjusted EBITDA improving by 7.3% to $1,095 million, while the adjustedEBITDA margin expanded to 51.6%.

DP World has delivered another set of strong financial results

in 2013, with profit attributable to owners of the Companygrowing 10.9% to $604 million.

“OUR RESILIENT PERFORMANCEILLUSTRATES THAT A PORTFOLIOEXPOSED TO ORIGIN AND

DESTINATION CARGO IN FASTERGROWING MARKETS, CONTINUESTO BE THE RIGHT BUSINESSMODEL TO PURSUE.”YUVRAJ NARAYANCHIEF FINANCIAL OFFICER

16 Like-for-like adjusted EBITDA margin.


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ASIA PACIFIC AND INDIAN SUBCONTINENT


(US$m)2012

(US$m) % change


change

Consolidated throughput (TEU ‘000) 4,604 5,401 (14.8%) (3.9%)Revenue 355 457 (22.2%) (7.6%)

Share of profit from equity-accounted investees 90 111 (18.7%) (4.5%)Adjusted EBITDA 220 299 (26.6%) (13.4%)Adjusted EBITDA margin 61.8% 65.6% – 59.8%17

It has been well documented that market conditions in the Asia Pacific and Indian Subcontinent region were challenging, particularly in thefirst half of 2013. Weaker than expected GDP growth in Asia combined with a depreciating currency and divestments and monetisationsimpacted reported volumes, which were down 15% for the year. However, on a like-for-like basis the decline was a more modest 4.0%.Reported revenues declined to $355 million while adjusted EBITDA fell to $220 million. However our focus on higher margin cargo andcost efficiencies meant that our margin was protected with an adjusted EBITDA margin of 61.8%. On a more positive note, we witnessedimproved market conditions in the second half of 2013 in the region.

AUSTRALIA AND AMERICAS


(US$m)2012

(US$m) % change


change

Consolidated throughput (TEU ‘000) 2,480 2,494 (0.6%) (0.6%)Revenue 594 553 7.5% 8.9%Share of profit from equity-accounted investees (14.0) (1.0) – –Adjusted EBITDA 195 166 17.7% 31.7%Adjusted EBITDA margin 32.9% 30.0% – 34.7%18

The Australia and Americas region delivered a resilient performance with consolidated volumes down marginally by 0.6% in 2013. TheAmericas delivered a softer performance in the second half of the year due to tough prior year comparables. Overall our revenues in theAustralia and Americas region grew by 7.5% to $594 million for the year and our focus on higher margin cargo meant that our adjustedEBITDA of $195 million was up by a pleasing 18% on the prior period, while adjusted EBITDA margins also grew to 32.9%.

CASH FLOW AND BALANCE SHEET

Cash generation remained strong with cash from operations standing at $1,299 million for 2013. Our capex reached $1,063 million as we

delivered some key projects including the DP World London Gateway port (UK) and the expansion at Jebel Ali (UAE). Gross debt rosemarginally to $5,035 million while net debt declined to $2,464 million. Our gearing remains relatively low with net debt to adjustedEBITDA standing at 1.7 times.

CAPITAL EXPENDITURE

We maintain our 2012-2014 $3.7 billion capital expenditure guidance as our projects remain on schedule and on budget. We look forwardto adding further capacity at Jebel Ali (UAE) and Rotterdam (the Netherlands). The lower than expected reported capital expenditure in2013 is due to timing differences and we expect that to unwind in 2014.

2020 TARGETS

In summary, we continue to work towards achieving our 2020 targets of 50% adjusted EBITDA margins and 15% ROCE on our existingportfolio. While reported adjusted EBITDA margin stood at 46%, the margin on a like-for-like basis was 47.6%. Our ROCE for our portfolioof assets reached 6.7% in 2013, up from 4.4% in 2010. We expect further ROCE improvement in the coming years as we continue togrow and increase utilisation levels across the portfolio.

Yuvraj NarayanChief Financial Officer

Achieving

financial efficiency

17 Like-for-like adjusted EBITDA margin.18 Like-for-like adjusted EBITDA margin.


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DP WorldCorporateResponsibility

Corporate Responsibility

At DP World, we believe in being a responsible corporate citizen

and making a sustainable difference in the communities in whichwe operate.

Our senior management painted a canvas with the team from “Mawaheb from Beautiful People”, an art studio inDubai for adults with special needs

Corporate responsibility is good for ourpeople, our customers, our communities

and our environment. We recognise thatfully integrated corporate responsibilitydoes not happen overnight and it requireschange across systems, processes, peopleand behaviours. Our business involveslong-term investments and sustainabledevelopment takes time to develop,integrate and build. The aim of ourcorporate responsibility approach is tointegrate responsible business practicesinto our daily activities to bring aboutlong-term sustained improvements thatmeet the needs of the communities inwhich we operate, both today and in thefuture. We recognise that our global reachbrings diversity. Rather than applying auniform policy across the markets in whichwe operate, our corporate responsibilityeffort is based on the four quadrants ofcommunity, environment, people & safetyand marketplace which are applied tosuit the local needs of each community.Having a global plan with local actionprovides consistency, yet enables eachbusiness unit to consider what willprovide the greatest benefit relevant towhat they do and where they operate.

Build sustainablecommunities throughstrategic communityinvestment

Reduce our impacton the environmentthrough innovation,new technologies andbehavioural change

Build an inclusive,supportive and safework environmentthat develops theprogression of our

people and createsa culture of diversity,safety and well-being

Be recognised asa sector leaderin corporateresponsibilityand governance,

thought leadershipand innovation


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T E ME NT S

Making asustainabledifference

The Corporate Responsibility AdvisoryCommittee supports the integration of

corporate responsibility into our business.The Committee is chaired by the GroupCEO, Mohammed Sharaf and met fourtimes during 2013 with key outcomesincluding:

• policy development andimplementation;

• introduction of the corporateresponsibility scorecard to measureprogress at the regional level;

• embedding corporate responsibilityinto objectives and personaldevelopment plans; and

• reviewing and setting corporateresponsibility budgets.

Corporate responsibility is a strategicpillar of our global strategy, an enableressential to facilitating the responsibledevelopment and sustainable growth ofour business. To support the sharing ofbest practice and the regional integrationof our corporate responsibility strategy,13 corporate responsibility champions wereappointed across the regions and they metfive times during 2013 via teleconference.

The Board receives a safety andenvironment report at each Board meetingto monitor the Group’s performanceagainst key performance metrics. Ourmanagement also plays a role in leading byexample by actively promoting safety onsiteto create a safer working environment.

Stakeholder engagement is essentialto the successful implementation of

our corporate responsibility strategy.Increasingly our business units undertakestakeholder engagement mapping tounderstand and identify key issues so thatwe can engage the wider community,especially at our new developments. In2013, we developed stakeholder mappingtools for the corporate responsibilitychampions to use when developingnew partnerships in the community.

Staff surveys were widely conductedacross our terminals to gain a betterunderstanding of our peoples’ knowledgeof our corporate responsibility frameworkand strategy and to collect their ideason corporate responsibility initiatives andinterest in participating in programmes.The results of the surveys will form thebasis for developing the 2014 corporateresponsibility business unit and regionalaction plans. The corporate responsibilitychampions, in collaboration with regionalmanagement, have developed theregional corporate responsibility plans.

MEASURING PROGRESS

We regularly measure our progressagainst our corporate responsibility

strategy. In 2013, we launched thecorporate responsibility scorecard, atool for our corporate responsibilitychampions to measure progress in regionsand business units against our fourquadrant framework. The scorecard wascompleted twice during 2013 and theresults were reported to the CorporateResponsibility Advisory Committee.

We also believe that it is important tomeasure changes in behaviour and

embed such change through individualperformance objectives. Significantly, anoutcome of the Corporate ResponsibilityAdvisory Committee in 2013 was thedecision to incorporate corporateresponsibility focused objectives for seniormanagement with ongoing monitoring tobe implemented in 2014 to chart progress.

COMMUNICATION

The key to involving and inspiring ourpeople is communication. In 2013, wedeveloped a clear corporate responsibilitycommunications plan with key messageswhich was distributed to the corporateresponsibility champions for inclusionin regional communications. We haverefreshed our external website to ensurethat external audiences are aware andunderstand our approach. We alsolaunched an online e-learning module forour people to improve their understandingof what corporate responsibility is andwhat it means to our Company. In 2014,we will further focus on developingour internal communication tools.


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FOR MORE INFORMATIONSEE PAGE 41

CommunityBuild sustainable communitiesthrough strategic communityinvestment.

Environment

Reduce our impact on theenvironment through innovation,new technologies and behaviouralchange.

• Implemented a communityinvestment framework.

• Implemented a grant agreementtemplate to promote goodgovernance when partnering withnot-for-profit organisations.

• Implemented the corporateresponsibility scorecard for

• Completed a global energy footprintassessment for our business.

• Received an external reviewof our carbon management,achieving distinguished scores foremission management, strategyand governance categories.

Corporate ResponsibilityOur Four Quadrant Approach to Corporate Responsibility

Our corporate responsibility strategy is based on the four

quadrants of community, environment, people & safety andmarketplace which are applied to suit the local needs of eachcommunity. Our progress in 2013 and our future focus areas foreach of the quadrants are outlined in the table below.

2013 ACHIEVEMENTS

measuring our progress againststrategy across our Group.

• Developed and implementeda volunteering programme forHead Office employees.

• Improved communication and increasedregional understanding of our strategiccommunity investment approach.

• Invested in establishing a specialistenergy management team of engineers,environmental specialists and operationsanalysts, to drive reductions in energyconsumption across our Group.

MarketplaceBe recognised as a sector leaderin corporate responsibility andgovernance, thought leadershipand innovation.

• Co-convened the third Counter-PiracyConference themed ‘CounteringMaritime Piracy: Continued Effortsfor Regional Capacity Building’.

• Updated our website with a dedicatedcorporate responsibility section to

improve external communication.

• Increased communication regardingour corporate responsibility initiativeswith 17 related press releasesbeing issued during the year.

People and SafetyBuild an inclusive, supportiveand safe work environment that

develops the progression of ourpeople and creates a culture ofdiversity, safety and well-being.

• Won Best Implementation ofDigital Learning Award MEA andlaunched a number of e-learninginitiatives and workshops tosupport the continued learning

and development of our people.• 556 people from our team receivedoperations specific training deliveredby our DP World Institute.

• Introduced Human Capital globalsafety standards and introduced newglobal engagement programmesfor implementation at our terminalsto manage risks to our people, our

assets and the environment.• Conducted the 2013 My Worldglobal employ

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