Royal Vopak Nv · EURONEXT:VPK
Royal Vopak Nv — Q3 2016 Earnings Presentation
64 slides from Royal Vopak Nv's earnings presentation, 2016
Slide 1: The World of Vopak Q3 2016 Results
THE WORLD OF VOPAK Q3 2016 RESULTS ROYAL VOPAK Q3 2016 ROADSHOW PRESENTATION
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation contains ‘forward-looking statements’, based on currently available plans and forecasts. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the
Slide 3: General Introduction
GENERAL INTRODUCTION ROYAL VOPAK Q3 2016 ROADSHOW PRESENTATION
Slide 4: Historical Overview
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics HISTORICAL OVERVIEW VOPAK AND ITS MAIN PRECURSORS 1616 ‘De Blaauwhoudenveem’ was founded 1967 (much later known as ‘Blaauwhoed’) Merger of Pakhuismeesteren and Blaauwhoed into 1
Slide 5: Vopak at a Glance
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics VOPAK AT A GLANCE THE WORLD’S LEADING INDEPENDENT TANK STORAGE COMPANY Listed at the Building on an Euronext AEX impressive history of Market cap. of 400 years EUR ~6.0 billion*
Slide 6: Financial Development
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics FINANCIAL DEVELOPMENT Occupancy rate EBITDA development In percent In EUR million 94 96 95 94 93 93 91 88 88 92 768 753 763 812 598 636 513 370 429 314 2006 2007 2008 2009 2010
Slide 7: Vopak's Ambition
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics VOPAK’S AMBITION TO BE THE PARTNER OF CHOICE FOR ALL OUR STAKEHOLDERS Strategic Safe, Strong and Ability to Operating efficient reliable link in innovate and according to locati
Slide 8: Sustainability at the Core
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics SUSTAINABILITY AT THE CORE STAYING HEALTHY AND FIT FOR THE FUTURE 8 Q3 2016 ROADSHOW PRESENTATION
Slide 9: Execution of the Strategy
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics EXECUTION OF THE STRATEGY STRIVING TO BE THE PARTHER OF CHOICE o Organizational alignment o Divestment program o Projects under construction and new BD opportunities o Safety an
Slide 10: Priorities for Cash
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics PRIORITIES FOR CASH 1 Debt servicing EUR 2 billion, remaining maturity 8 years, average interest 4.1% 2 Dividend EUR 0.9 billion paid to shareholders in the last 12 years 3 Disc
Slide 11: Business Challenges
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics BUSINESS CHALLENGES Strategic Operational Safety and service Competitive environment Global maintenance Shifting energy landscape management and product flows Systems and techno
Slide 12: Discussions with Investors
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics DISCUSSIONS WITH INVESTORS Economic and market dynamics Projects Slowdown emerging growth Projects under construction and business development Developments oil and Strat
Slide 13: Market Trends
MARKET TRENDS FIT FOR THE FUTURE ROYAL VOPAK Q3 2016 ROADSHOW PRESENTATION
Slide 14: Mega Trends
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics MEGA TRENDS INFLUENCING THE GLOBAL ECONOMIC EVOLUTION Industrialization and urbanization Changing demographics Disruptive technologies in emerging economies Geopolitical develop
Slide 15: Impact on End-Markets
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics IMPACT ON END-MARKETS FUTURE GROWTH IN THREE MAIN INDUSTIRES Trends Energy Manufacturing Food & Agriculture End Power generation sector to be Demand growth in the Growth d
Slide 16: Refined Products Outlook
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics REFINED PRODUCTS OUTLOOK IMBALANCES EXPECTED TO INCREASE FSU Greater Europe North America Middle East 2015 2025 2015 2025 2015 2025 2015 2025 Asia Pacific Latin America Sub-Saha
Slide 17: Chemicals Outlook
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics CHEMICALS OUTLOOK STRONG GROWTH ETHYLENE CAPACITY Ethylene Capacity Growth 250 World consumption in mln tons 200 Other 150 Europe 100 Asia & Pacific Middle East 50 North America
Slide 18: Rebalancing of the LNG Market
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics REBALANCING OF THE LNG MARKET Norway ~4% Russia ~7% North America Qatar ~23% North Africa ~14% ~5% West Africa ~7% Malaysia ~4% Indonesia ~3% LNG exported in 2015 Existing LNG f
Slide 19: Strategy Execution: Growth Leadership
STRATEGY EXECUTION GROWTH LEADERSHIP ROYAL VOPAK Q3 2016 ROADSHOW PRESENTATION
Slide 20: Storage Capacity Developments
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics STORAGE CAPACITY DEVELOPMENTS FOCUS ON SELECTIVE DISCIPLINED GROWTH Storage capacity In million cbm +14.7 +3.5 Projects under Growing our global network through development up t
Slide 21: Growth Leadership: Terminal Portfolio Criteria
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics GROWTH LEADERSHIP TERMINAL PORTFOLIO CRITERIA Major hubs Industrial terminals Distribution terminals Gas markets Fujairah 7 JCSSC PCQ2 Durban Fuel 2 / 3 Banyan LPG facility 21 Q
Slide 22: Global Presence
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics GLOBAL PRESENCE Hamburg Talinn Amsterdam Rotterdam Antwerp Yangpu Ningbo Haiteng Lanshan Tianjin Zhangjiagang Tarragona Karachi Barcelona Kandla Algeciras Rayong Quebec Ho Chi M
Slide 23: Return Requirements for Investments
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics RETURN REQUIREMENTS FOR INVESTMENTS Footprint in Optimization growth emerging markets opportunities I II First-mover Option advantage value Contribution from key accounts VI III
Slide 24: Investment and Divestments
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics INVESTMENT AND DIVESTMENTS INVESTMENTS AND DIVESTMENTS Japan UK assets Jubail Panama -203,200 cbm 348,000 cbm -696,600 cbm 509,000 cbm 220,000 cbm 360,000 cbm Fuijairah Alemoa 4
Slide 25: Impact Divestments YTD 2016 Results
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics IMPACT DIVESTMENTS YTD 2016 RESULTS ADJUSTED FOR THE DIVESTMENTS IN 2015 AND EARLY 2016 Revenues** +4% US: Galena Park and In EUR million Wilmington terminals Finland UK 991.0 1
Slide 26: Selective Growth Opportunities
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics SELECTIVE GROWTH OPPORTUNITIES EFFECTIVE AND SOUND STRATEGIC ORIENTATION +3.5 3.4 38.1 +0.3 1.2 34.6 0.1 34.3 0.9 FY 2015 Brownfield, Divestments Q3 2016 Brownfield Greenfield 2
Slide 27: Projects Under Development
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics PROJECTS UNDER DEVELOPMENT ANNOUNCED STORAGE CAPACITY DEVELOPMENTS Announced storage capacity developments for the period up to and including 2019 Vopak's Capacity Country Termi
Slide 28: Strategy Execution: Operational Leadership
STRATEGY EXECUTION OPERATIONAL LEADERSHIP ROYAL VOPAK Q3 2016 ROADSHOW PRESENTATION
Slide 29: Execution of the Business: Operational Leadership
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics EXECUTION OF THE BUSINESS OPERATIONAL LEADERSHIP 1. Safety o Maximizing operational safety o Minimizing environmental impact 2. Effectiveness o Maximizing operational productivi
Slide 30: Commitment to Safety
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics COMMITMENT TO SAFETY Total injury rate (TIR) Lost time injury rate (LTIR) Total injuries per 200,000 hours worked by Total injuries leading to lost time per 200,000 hours own em
Slide 31: Strategy Execution: Customer Leadership
STRATEGY EXECUTION CUSTOMER LEADERSHIP ROYAL VOPAK Q3 2016 ROADSHOW PRESENTATION
Slide 32: Business Model
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics BUSINESS MODEL Blending nitrogen Adding / cooling Heating / unloading of ships / railcars / trucks Loading Excess througput fees Monthly invoicing in arrears Services Fixed rent
Slide 33: Customer Portfolio
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics CUSTOMER PORTFOLIO Global clients Regional clients Local clients Active at multiple Vopak Active in more than one Active in one Vopak locations around the Vopak location o
Slide 34: Sound Contract Durations
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics SOUND CONTRACT DURATIONS Contract position FY2013 Contract position FY2014 Contract position FY2015 In percent of revenues In percent of revenues In percent of revenues 20% 21%
Slide 35: Market Share According to Definition
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics MARKET SHARE ACCORDING TO DEFINITION Oil storage market Non-oil storage market* Total storage market In million cbm In million cbm In million cbm Primary competition 152.0 36.6
Slide 36: Capital Management
CAPITAL MANAGEMENT ROYAL VOPAK Q3 2016 ROADSHOW PRESENTATION
Slide 37: Value Creation: Disciplined Capital Allocation
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics VALUE CREATION DISCIPLINED CAPITAL ALLOCATION Total investments 2004-2019 Expansion capex** In EUR million In EUR million; 100% = EUR 2,100 million 2,610 2,588 Remaining ~300 Vo
Slide 38: Headroom for Growth
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics HEADROOM FOR GROWTH MAINTAINING A SOLID FINANCIAL POSITION Senior net debt : EBITDA ratio Maximum ratio under other PP programs and syndicated revolving credit facility 5 Maximu
Slide 39: Capital Structure
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics CAPITAL STRUCTURE Syndicated Ordinary shares Private placement Equity(-like)* revolving program* credit facility* Listed on Euronext USD: 1.9 billion EUR 1.0 billion Subordinate
Slide 40: Debt Repayment Schedule
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics DEBT REPAYMENT SCHEDULE Debt repayment schedule In EUR million RCF flexibility US PP RCF drawn Asian PP Subordinated US PP Other 1,200 1,100 1,000 400 300 200 100 0 2016 2017 20
Slide 41: Net Finance Costs
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics NET FINANCE COSTS Net finance costs HY 2016 Net finance costs HY 2015 In EUR million In EUR million Interest and dividend income 6.0 6.1 Finance costs -61.9 -53.7 Net finance co
Slide 42: Solid Financial Position
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics SOLID FINANCIAL POSITION MAINTAINING A CONSISTENT SOLVENCY WHILST GROWING OUR GLOBAL NETWORK Total equity and net liabilities Net liabilities* Equity 60% 64% 64% 36% 40% 36% FY
Slide 43: Stable Dividend Growth
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics STABLE DIVIDEND GROWTH PROPOSED DIVIDEND INCREASED WITH 11% TO EUR 1.00 PER SHARE Barring exceptional Dividend and EPS* 2003-2015 circumstances, the In EUR intention is to pay 3
Slide 44: Business Performance: Q3 2016 Results
BUSINESS PERFORMANCE Q3 2016 RESULTS ROYAL VOPAK Q3 2016 ROADSHOW PRESENTATION
Slide 45: Long-Term Value Creation
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics LONG-TERM VALUE CREATION KEY ELEMENTS SUPPORTING OUR BUSINESS MODEL Focus on Strong capital risk-return structure with Stable margins and healthy Diversified and take-or-pay cas
Slide 46: Occupancy Rate Developments
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics OCCUPANCY RATE DEVELOPMENTS OCCUPANCY IN Q3 ABOVE 90%, IN LINE WITH FY OUTLOOK Occupancy rate* In percent 90-95% 85-90% 92 93 94 94 94 93 88 88 91 91 2004 2005 2006 2007 2008 20
Slide 47: YTD Q3 2016 Key Figures Excluding Exceptional Items
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics YTD Q3 2016 KEY FIGURES -EXCLUDING EXCEPTIONAL ITEMS- SOLID RESULTS SUPPORTED BY HEALTHY OCCUPANCY RATES Revenues* -3% EBITDA** +4% In EUR million In EUR million 1,035.6 624.7 6
Slide 48: YTD Q3 2016 EBITDA Analysis
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics YTD Q3 2016 EBITDA ANALYSIS +4% 8.8 0.1 1.2 624.7 6.3 8.8 602.1 9.6 19.4 9.3 570.5 22.3 Pre-OPEX Acquisitions/ Divestments YTD Q3 FX-effect Adjusted Greenfields , Netherlands EM
Slide 49: Q3 2016 Key Figures Excluding Exceptional Items
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics Q3 2016 KEY FIGURES -EXCLUDING EXCEPTIONAL ITEMS- Revenues* EBITDA** In EUR million -2% In EUR million +5% 350.4 214.7 347.9 209.4 206.2 203.8 334.9 332.0 328.2 193.7 Q3 Q4 Q1 Q
Slide 50: Margin Developments
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics MARGIN DEVELOPMENTS BALANCED RISK-RETURN PROFILE AND FOCUS ON COST COMPETITIVENESS EBIT(DA) margin* In percent 60 EBITDA margin EBIT margin 45 30 15 0 2004 2005 2006 2007 2008 2
Slide 51: HY1 2016 Return Indicators
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics HY1 2016 RETURN INDICATORS FOCUS ON FREE CASH FLOW AND PROFITABLE GROWTH NON-IFRS IFRS BASED PROPORTIONAL ROE* ROCE** CFROGA*** (after interest, after tax) (before interest, bef
Slide 52: HY1 2016 IFRS vs. Non-IFRS Proportionate Information
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics HY1 2016 IFRS VS. NON-IFRS PROPORTIONATE INFORMATION IFRS BASED NON-IFRS PROPORTIONAL +3pp +4pp Occupancy rate Occupancy rate In percent In percent 94 94 91 90 88 88 2014 2015 2
Slide 53: Business Performance: Segmentation
BUSINESS PERFORMANCE SEGMENTATION ROYAL VOPAK Q3 2016 ROADSHOW PRESENTATION
Slide 54: Occupancy Rate Developments per Division
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics OCCUPANCY RATE DEVELOPMENTS PER DIVISION Occupancy rates In percent 96 96 96 96 96 95 95 95 94 94 92 92 92 91 91 91 91 90 89 89 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Netherlan
Slide 55: YTD Q3 2016 Netherlands Development
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics YTD Q3 2016 NETHERLANDS DEVELOPMENT Occupancy rate* In percent +1pp 94 95 90 87 83 2012 2013 2014 2015 2016 Revenues* In percent +4% 360.5 373.8 Storage capacity 340.4 328.3 332
Slide 56: YTD Q3 2016 EMEA Development
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics YTD Q3 2016 EMEA DEVELOPMENT Occupancy rate* In percent +3pp 92 95 88 89 83 2012 2013 2014 2015 2016 Revenues* In percent -25% 176.3 182.7 191.1 191.3 Storage capacity 144.0 In
Slide 57: YTD Q3 2016 Asia Development
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics YTD Q3 2016 ASIA DEVELOPMENT Occupancy rate* In percent +4pp 95 95 95 92 88 2012 2013 2014 2015 2016 Revenues* In percent +1% 284.8 288.9 Storage capacity 265.6 270.6 273.4 In m
Slide 58: YTD Q3 2016 Americas Development
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics YTD Q3 2016 AMERICAS DEVELOPMENT Occupancy rate* In percent +1pp 94 90 90 90 91 2012 2013 2014 2015 2016 Revenues* In percent +1% 196.1 198.2 200.6 Storage capacity 181.9 183.0
Slide 59: YTD Q3 2016 Net Result of JVs and Associates
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics YTD Q3 2016 NET RESULT OF JVS AND ASSOCIATES Netherlands Americas -20% 1.8 2.0 2.0 1.6 0.8 0.2 0.2 0.2 2013 2014 2015 2016 2013 2014 2015 2016 Net result of JVs EMEA Global LNG
Slide 60: Looking Ahead & Other Topics
LOOKING AHEAD & OTHER TOPICS ROYAL VOPAK Q3 2016 ROADSHOW PRESENTATION
Slide 61: Strategic Priorities
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics STRATEGIC PRIORITIES EXECUTION ON TRACK Strategic Reduce Enhance capital and Growth Sustaining capex organizational efficiency 4 100 Sharpen focus on free terminal types EUR
Slide 62: Outlook 2016
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics OUTLOOK 2016 FY 2015 Business Expansions Occupancy Divestments FX effect FY 2016 developments and acquisitions rate effect and other and operational efficiency Note: for illustr
Slide 63: Outlook Assumptions
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics OUTLOOK ASSUMPTIONS Oil Chemical Industrial & Vegoils & Gas products products pipeline connected biofuels products Share of EBITDA* 45-50% 20-25% 20-25% 5-7.5% 2.5-5% Contract d
Slide 64: Other Topics
General Market Strategy Capital Business Looking ahead introduction trends execution management performance & other topics OTHER TOPICS Effective tax rate* HY 2016 EBITDA* transactional currencies In percent In percent 21.0 21.2 21% 18.2 16.5 USD SGD EUR 15% 39% Other HY 2013 HY 2014 HY 2015 HY 2016