Royal Vopak NV · EURONEXT:VPK
Royal Vopak NV — Q3 2021 Earnings Presentation
37 slides from Royal Vopak NV's earnings presentation, 2021
Slide 1: Storing vital products with care
Storing vital products with care Third Quarter 2021 – Roadshow Presentation Royal Vopak
Slide 2: Forward-looking statement
Forward-looking statement 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: Vopak at a glance
Vopak at a glance At year-end 2020 Number of Number of Storage capacity terminals countries In million cbm ▪ World’s leading independent tank storage company 70 23 35.6 34.4 35.6 ▪ Diversified customer base including all major 2019 2020 chemical producers and global oil & gas companies Market Number
Slide 4: Investment Highlights
Investment Highlights World’s leading independent tank storage company Highly diversified portfolio of terminals across regions and product lines Solid drivers for demand New expansion projects Well positioned for the shift towards a more sustainable & digital world New energy focus area Long-term c
Slide 5: Products and Customers
Products and Customers Playing a vital link in the supply chain for gas, chemicals and oil Gas Chemical Oil products LNG, LPG, Handling and storing Methanol, xylenes, Crude oil, gasoline, vital products… ethylene, butadiene, styrene, MEG, vegoils naphtha, diesel, fuel oil ammonia Blue-chip customer
Slide 6: Strategic terminal types
Strategic terminal types New Energy & Industrial Gas Chemical Oil feedstock terminals terminals terminals terminals Petrochemical clusters are Vopak actively pursues becoming larger and more Vopak is expanding its gas Demand for chemicals storage storage – in response to is growing. Vopak operates a
Slide 7: CEO succession
CEO succession Eelco Hoekstra to be succeeded by Dick Richelle Eelco Hoekstra decided to not seek a fourth term, after having served 11 years as Chairman of the Executive Board and CEO of Royal Vopak. The Supervisory Board nominated Dick Richelle to become Chairman of the Executive Board and tak
Slide 8: Long-term sustainable portfolio
Long-term sustainable portfolio Continuous portfolio developments Strong global demand recovery in all product market combinations has resulted in high commodity prices Market Chemical, oil and gas markets are tight resulting in soft markets for storage services conditions We believe 2022 will
Slide 9: Portfolio transformation
Portfolio transformation Shift towards industrial terminals, chemicals and gas terminals Key projects Proportional revenue by product category ~10% ~10% 10-15% ~15% Gas • SPEC LNG - Colombia ~15% 20-25% 25-30% Gas terminals • ETPL LNG - Pakistan 25-30% Industrial terminals 35-40% • RIPET LPG - Canad
Slide 10: Data-driven digital transformation
Data-driven digital transformation IT multi-year program expected to be completed by end of 2023 ▪ Centralized cyber security Digital ▪ Replacing and modernizing our Cyber security company-wide IT and OT program to protect our systems Modernization systems ▪ Significant reduction in response ▪ Devel
Slide 11: Overview financial framework
Overview financial framework Performance delivery and managing value ▪ Clear financial framework to support strategy ▪ Balanced portfolio management with focus on strong operational cash flow generation with a disciplined capital investment approach ▪ Aimed towards a strong investment case • Return
Slide 12: UN Sustainable Development Goals (SDGs)
UN Sustainable Development Goals (SDGs) 5 selected SDGs to create a focus on where we can contribute to society Description Ambitions / targets Vopak contributes to facilitating energy security and the energy transition by creating reliable access to energy and developing infrastructure solutions fo
Slide 13: Environmental, Social & Governance (ESG)
Environmental, Social & Governance (ESG) Ambition to be sustainability leader ESG benchmarks Vopak Solar Park Eemshaven • Vopak, Groningen Seaports and Whitehelm joined forces to open 25 MSCI MW solar park in the Netherlands Rating: AAA (Scale: CCC to AAA) • The opening of the park marks Vopak’s t
Slide 14: YTD Q3 2021 Key messages
YTD Q3 2021 Key messages Strong financial performance with EBITDA growth of 5% YoY, adjusted for currency effect Growth project contribution of EUR 35 million and efficiency are driving positive EBITDA performance in soft business conditions Cost efficiency measures are tracking well including
Slide 15: Q3 Portfolio highlights
Q3 Portfolio highlights Vopak aims to grow in the regasification of LNG Strong existing LNG portfolio… …with the ambition for growth Existing assets • Netherlands, Gate – very high utilization in 2021, successful maintenance turnaround program and regasification capacity expansion of 12.5% Netherlan
Slide 16: Our New Energy focus areas
Our New Energy focus areas Vopak currently pursues 10+ infrastructure projects and studies Sustainable Hydrogen feedstocks H-vision: low-carbon hydrogen in Netherlands to decarbonize Import green ammonia from Morocco, Middle East and industry Australia Pilot: green liquid organic hydrogen carr
Slide 17: Vopak Ventures
Vopak Ventures An overall positive valuation effect in Vopak Ventures of EUR 39 million Vopak Ventures New Energies, Feedstock Operational Excellence & Platforms, Data & & Sustainability Asset Management Digitalization Q3 2021 Roadshow Presentation 17
Slide 18: YTD Q3 2021 vs YTD Q3 2020 EBITDA
YTD Q3 2021 vs YTD Q3 2020 EBITDA EBITDA increased by EUR 29 million (+5% YoY) adjusted for currency effects, strong performance in Europe & Africa 4.5 4.4 4.6 11.2 619.1 2.6 602.7 33.3 13.0 YTD Q3 FX-effect Europe & Americas China & LNG Asia & Global YTD Q3 2020 Africa North Asia Middle East functi
Slide 19: Divisional performance
Divisional performance Americas benefits from growth projects; Asia & ME reflects soft market conditions; Europe & Africa benefits from South Africa; China & North Asia resilient Americas Asia & Middle East China & North Asia 92 90 87 86 87 94 93 92 90 88 88 84 90 89 90 44.9 47.2 42.4 46.3 48.9 70.0
Slide 20: YTD Q3 2021 vs YTD Q3 2020 EBITDA
YTD Q3 2021 vs YTD Q3 2020 EBITDA EBITDA performance driven by growth project contribution in soft markets and negative currency effects Business environment Performance changes delivery 619 10-15 5-10 603 13 35 25-35 9 YTD Q3 Oil Chemicals FX-effect Expenses Growth YTD Q3 2020 Markets Markets proje
Slide 21: Cash flow from operations growth
Cash flow from operations growth FCF before financing impacted by derivatives, working capital movements and lack of cash flows from portfolio effects YTD Q3 2021 YTD Q3 2020 In EUR million In EUR million +5% YoY 562 553 535 58 40 524 44 29 84 434 48 386 +16 203 168 -128 321 318 257 222 164 86 226 6
Slide 22: Investment phasing
Investment phasing Strategic investments aiming to capture growth In 2021, growth investment is expected to be around EUR 275 million below our previously announced range of EUR 300 million to EUR 350 Investments million. The allocation of these investments will be through existing In EUR million
Slide 23: Investments supporting future growth
Investments supporting future growth Vopak has grown EBITDA historically and aims to grow EBITDA by EUR 110-125 million in 2023 from committed growth projects Capital employed and equity* (in EUR million) CAGR (In %) Growth project contribution to reported EBITDA (in EUR million) 5,000 Average Capit
Slide 24: Robust balance sheet
Robust balance sheet Target leverage of 2.5 to 3.0 times senior net debt : EBITDA Priorities for cash Senior net debt : EBITDA ratio Growth investment multiples for covenant (frozen GAAP) Invested capital / normalized projected EBITDA* Debt servicing 1 average interest rate 2020: 3.7% 10x • Acquisit
Slide 25: Increase in shareholder returns
Increase in shareholder returns Continued rising cash dividend Dividend and EPS* Dividend policy In EUR 2.80 Dividend policy targets to pay an annual 2.55 2.56 2.25 2.27 2.42 stable to rising cash dividend in balance with a management view on a payout ratio range of 25-75% of the net profit excludin
Slide 26: Non-IFRS proportional information
Non-IFRS proportional information Increased EBITDA, both IFRS and non-IFRS, due to growth projects in soft markets EBITDA Occupancy rate In EUR million In percent – subsidiaries only IFRS BASED 200 200 206 213 91 90 88 87 87 189 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 2020 2020 2021 2021 2021 2020 2020 2021 2
Slide 27: Looking ahead
Looking ahead In 2021, reported EBITDA contributions from 2020 and 2021 growth projects are expected to be at the higher end of the EUR 30 million to EUR 50 million range, subject to market conditions and currency exchange movements In 2023, reported EBITDA contribution from 2020, and currently
Slide 28: Appendix
Storing vital products with care Q3 2021 Roadshow Presentation Appendix
Slide 29: Debt repayment schedule
Debt repayment schedule Debt repayment schedule In EUR million 1,500 Priorities for cash RCF headroom RCF drawn Debt servicing Other 1 average interest rate 2020: 3.7% 1,000 Subordinated loans Asian PP Growth opportunities 2 Value accretive growth US PP Shareholder dividend 3 Stable to rising cash d
Slide 30: Q3 2021 vs Q2 2021 EBITDA
Q3 2021 vs Q2 2021 EBITDA EBITDA growth across all regions 0.7 0 1.3 212.5 1.3 2.6 2.9 206.2 0.2 Q2 2021 FX-effect Asia & Americas Europe & LNG China & Global Q3 2021 Middle East Africa North Asia functions, corporate activities and others Figures in EUR million, excluding exceptional items includin
Slide 31: Americas developments
Americas developments Storage capacity Proportional occupancy rate Revenues* In million cbm In percent In EUR million 0.5 Total Q3 2021 94 93 90 89 90 83.1 81.1 79.2 5.5 million cbm 78.3 77.6 1.0 4.0 Subsidiaries Joint ventures & associates Operatorships Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 2020 2020 2021
Slide 32: Asia & Middle East developments
Asia & Middle East developments Storage capacity Proportional occupancy rate Revenues* In million cbm In percent In EUR million Total Q3 2021 92 90 88 88 70.3 71.1 69.9 70.7 68.9 3.3 84 4.2 15.5 million cbm Subsidiaries Joint ventures & associates 8.0 Operatorships Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 2020
Slide 33: China & North Asia developments
China & North Asia developments Storage capacity Proportional occupancy rate Revenues* In million cbm In percent In EUR million Total Q3 2021 92 90 87 86 87 0.8 3.1 million cbm 10.6 11.2 10.7 10.9 11.2 Subsidiaries 2.3 Joint ventures & associates Operatorships Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 2020 2020
Slide 34: Europe & Africa developments
Europe & Africa developments Storage capacity Proportional occupancy rate Revenues* In million cbm In percent In EUR million 1.3 Total Q3 2021 91 91 88 87 88 136.2 141.8 140.8 141.2 142.7 10.7 million cbm Subsidiaries 9.4 Joint ventures & associates Operatorships Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 2020 2
Slide 35: JVs & associates developments
JVs & associates developments Net result JVs and associates* Americas* Asia & Middle East* In EUR million In EUR million In EUR million 43.4 43.4 42.5 42.2 20.6 22.1 25.8 19.6 19.0 4.0 3.1 2.1 2.1 1.5 0.7 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 2020 2020 2021 2021 2021 2020 2020 2021 2021 2021
Slide 36: Occupancy rate developments
Occupancy rate developments Lower occupancy rate YTD Q3 2021 due to soft market conditions Subsidiary occupancy rate and out-of-service capacity In percent and million cbm 90-95% 85-90% 91 90 84 88 88 87 87 2011 2012 2013 2014 2015 2016 2017 2018 2019 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2020 2021 0.6 0.8 1.0 1.6 1
Slide 37: Project timelines
Project timelines Vopak’s Capacity* Country Terminal ownership Products (cbm) 2018 2019 2020 2021 2022 2023 2024 Growth projects Existing terminals Australia Sydney 100% Oil products 105,000 United States Deer Park 100% Chemicals 23,500 Mexico Altamira 100% Chemicals 40,000 China Shanghai - Caojing