| Q2 2018 | Q1 2018 | Q2 2017 | Q2-Q2 | In EUR millions | HY1 2018 | HY1 2017 | |
| 309.9 | 316.2 | 327.5 | - 5% | Revenues | 626.1 | 669.3 | - 6% |
| Results -excluding exceptional items- | |||||||
| 180.7 | 190.2 | 191.0 | - 5% | Group operating profit before depreciation and amortization (EBITDA) | 370.9 | 394.1 | - 6% |
| 113.8 | 122.9 | 122.7 | - 7% | Group operating profit (EBIT) | 236.7 | 258.1 | - 8% |
| 67.2 | 73.0 | 73.9 | - 9% | Net profit attributable to holders of ordinary shares | 140.2 | 150.4 | - 7% |
| 0.53 | 0.57 | 0.58 | - 9% | Earnings per ordinary share (in EUR) | 1.10 | 1.18 | - 7% |
| Results -including exceptional items- | |||||||
| 176.9 | 190.2 | 188.9 | - 6% | Group operating profit before depreciation and amortization (EBITDA) | 367.1 | 392.0 | - 6% |
| 110.0 | 122.9 | 120.6 | - 9% | Group operating profit (EBIT) | 232.9 | 256.0 | - 9% |
| 64.4 | 73.0 | 72.3 | - 11% | Net profit attributable to holders of ordinary shares | 137.4 | 148.8 | - 8% |
| 0.51 | 0.57 | 0.57 | - 11% | Earnings per ordinary share (in EUR) | 1.08 | 1.17 | - 8% |
| Cash flows from operating activities (gross) | 341.0 | 321.0 | 6% | ||||
| 85% | 87% | 90% | - 5pp | Occupancy rate subsidiaries | 86% | 91% | - 5pp |
| 36.0 | 35.9 | 35.9 | Storage capacity end of period (in million cbm) | 36.0 | 35.9 | ||
| 2.18 | 1.99 | 2.20 | Senior net debt : EBITDA | 2.18 | 2.20 | ||
| 11.5% | 12.3% | 11.9% | - 0.4pp | Return on Capital Employed (ROCE) | 11.9% | 12.3% | - 0.4pp |
| 9.0% | 9.5% | 9.5% | - 0.5pp | Cash Flow Return On Gross Assets (CFROGA) | 9.2% | 9.7% | - 0.5pp |
Highlights for HY1 2018 -excluding exceptional items-:
- EBITDA of EUR 371 million (HY1 2017: EUR 394 million). Adjusted for adverse currency translation effects of EUR 20 million, the EBITDA was comparable to prior year.
- Occupancy rate of 86% (HY1 2017: 91%) explained by lower rented capacity mainly at the oil hub terminals caused by a less favorable oil market structure. Other product-market segments showed continued stable demand for storage services.
- EBIT of EUR 237 million (HY1 2017: EUR 258 million) included EUR 15 million adverse currency translation effects.
- Net profit attributable to holders of ordinary shares of EUR 140 million (HY1 2017: EUR 150 million) resulting in earnings per ordinary share (EPS) of EUR 1.10 (HY1 2017: EUR 1.18).
- Return On Capital Employed (ROCE) of 11.9% (HY1 2017: 12.3%).
- Our worldwide storage capacity on a 100% basis was 36.0 million cbm per the end of the first half year of 2018. Our projects currently under development will add 3.2 million cbm of storage capacity to our global network in 2019.
- Vopak will conduct a strategic review and test the market value of its terminals in Algeciras, Amsterdam, Hamburg and Tallinn.
Exceptional items HY1 2018:
- There were no material exceptional items recognized in the first half year of 2018.
Subsequent events:
- On 20 July, Vopak and Engro Corporation announced the signing of a Share Purchase Agreement in which Vopak will acquire a 29% share in Engro Elengy Terminal Pakistan Ltd. (EETPL). This LNG import facility, located in Port Qasim, consists of an LNG jetty and high pressure gas pipeline. EETPL holds a 15 year Floating Storage and Regasification Unit (FSRU) time charter (capacity of 151,000 cbm). The acquisition is subject to certain conditions, including customary regulatory and shareholder approvals, and closing is anticipated to take place in Q4 2018.
- In July 2018, Vopak formalized the agreement regarding a new pension plan in the Netherlands effective per 1 January 2018, including a cash contribution of EUR 18.0 million. The agreement delivers a good outcome to both the participants and Vopak. The new pension plan provides flexibility to the participants and qualifies as a defined contribution plan under IAS 19. Going forward Vopak has the sole obligation to pay a contribution based on a fixed percentage of the pensionable salary. The total exceptional (non-cash) net gain before tax for the year from this event is EUR 19.1 million.
- Today, Vopak announces that it will expand its chemical terminal in Merak, Indonesia, with 50,000 cbm to 131,000 cbm. Merak is the main chemical import port of Indonesia and Merak has the highest concentration of petrochemical facilities. The expansion is expected to be commissioned in Q1 2020.
- Today, Vopak announces to invest in its Europoort terminal in Rotterdam, the Netherlands, to support 0.5% low sulphur fuel oil bunkering. This investment is supported by customer commitments and will be completed in the second half year of 2019.
- Vopak will further strengthen its global chemical storage positions. A new jetty will be constructed at Vopak Terminal Linkeroever in Antwerp, Belgium, enabling planned future growth. Furthermore, a major service improvement project will commence at Vopak Terminal Penjuru in Singapore, to service the chemical market in Singapore.
- Today, Vopak announces that it will conduct a strategic review and test the market value of its terminals in Algeciras, Amsterdam, Hamburg and Tallinn.
Looking ahead:
- The financial performance in 2018 is expected to be influenced by currency exchange movements of primarily the USD and SGD, and the currently less favorable oil market structure, impacting occupancy rates and price levels in the hub locations.
- Given the current 3.2 million cbm expansion program for 2019 with high commercial coverage, in conjunction with the cost efficiency delivery, Vopak has the potential to significantly improve the 2019 EBITDA, subject to market conditions and currency exchange movements.
- Our efficiency program to support margin development and reduce Vopak's future cost base with at least EUR 25 million has been delivered and is increased to EUR 40 million. As a result of the efficiency program the cost base for 2019, at current exchange rates, including EUR 15 million additional cost from growth projects, is expected to be below the 2017 reported operating expenses of EUR 676 million.
Royal Vopak Chief Executive Officer Eelco Hoekstra comments:
Vopak performance and strategy on track;
2018 remains difficult market, but provides opportunities.
"Given the market conditions to date, the results delivered are satisfactory. The execution of our strategy towards 2019 is very well on track and we increased our cost savings target for 2019.
We have successfully gone live with our new digital terminal management system in Long Beach and Los Angeles marking the start of our global roll out.
I see the shift in our portfolio of terminals with construction progressing and new projects being announced.
In our oil hub terminals the priority was to invest for the IMO 2020 bunker fuel regulations. Our terminals in Fujairah, Rotterdam, and Singapore will be fully ready to support new market requirements. Today we announce our investment plans for Rotterdam which are supported by customer commitments as of mid 2019.
In Saudi Arabia, together with our partners, we commissioned the last part of the industrial terminal Chemtank. The construction of our new industrial terminal in Pengerang is progressing well and first commissioning will take place end of 2018.
Our business development efforts in gas terminals have seen excellent progress. We announced the entrance in the growing LNG market in Pakistan, and the signing of two new joint ventures to develop LNG terminals in Germany and China.
We have made substantial progress in strengthening our chemical storage position globally. We have announced expansions in Houston and Rotterdam. Today we announce that we will invest in a new jetty in Antwerp, commence a major service improvement project in Penjuru, Singapore, and expand our terminal in Merak, Indonesia.
In total, we currently have more than 3 million cbm under construction. We find this the natural moment for a strategic review and test the market value of our terminals in Algeciras, Amsterdam, Hamburg and Tallinn. This review is fully in line with the focus on growing our portfolio with the four strategic terminal types (major hubs, gas & LNG, industrial terminals, distribution in major markets).
In the second half of the year, we will maintain our focus on both short-term performance and long-term value creation for all stakeholders and seize opportunities that are being created in today's market. This enables us to continue storing vital products with care."
Link to video of CEO and CFO commenting on Vopak's HY1 2018 results
The analyst' presentation will be given via an on-demand audio webcast on Vopak's corporate website www.vopak.com, starting at 9:30 am CEST on 17 August 2018.
For more information please contact:
Vopak Press: Liesbeth Lans - Manager External Communication,
Telephone: +31 (0)10 400 2777 | e-mail: global.communication@vopak.com
Vopak Analysts and Investors: Laurens de Graaf - Head of Investor Relations,
Telephone: +31 (0)10 400 2776 | e-mail: investor.relations@vopak.com
Profile Royal Vopak
Royal Vopak is the world's leading independent tank storage company. Vopak operates a global network of terminals located at strategic locations along major trade routes. With over 400 years of history and a strong focus on safety and sustainability, Vopak ensures safe, efficient and clean storage and handling of bulk liquid products and gases for our customers. By doing so, Vopak enables the delivery of products that are vital to our economy and daily lives, ranging from oil, chemicals, gases and LNG to biofuels and vegoils. Vopak is listed on the Euronext Amsterdam stock exchange and is headquartered in Rotterdam, the Netherlands. Including our joint ventures and associates, Vopak employs an international workforce of over 5,700 people. As of 17 August 2018, Vopak operates 66 terminals in 25 countries with a combined storage capacity of 36.0 million cbm, with another 3.3 million cbm under development.
This press release contains inside information as meant in clause 7 of the Market Abuse Regulation.
