The Netherlands, Rotterdam, 18 August 2004

• Net profit for first half 2004 EUR 37.5 million (2003: EUR 34.8 million)
• Net turnover for first half 2004 EUR 318.9 million (2003: EUR 371.1 million)
• Operating profit on core activities excluding exceptional items H1 2004 EUR 72.7 million (H1 2003 : EUR 68,1 million)
• Operating profit on core activities excluding exceptional items for second quarter 2004 EUR 38.6 million (Q1 2004: EUR 34.1 million)
• Net debt EUR 517.2 (31 December 2003: EUR 608.5 million)
• Outlook for 2004: operating profit on core activities excluding exceptional items at around the same level as in 2003 (EUR 150 million). 

Results

Net turnover of tank storage company Royal Vopak for the first half of 2004 increased by EUR 14 million, EUR 8.1 million of which came from acquisitions. The figure is after an adjustment for loss of turnover due to disposals of EUR 57.2 million and a negative foreign exchange effect of EUR 9.0 million.

Operating profit on core activities for the first half of 2004, excluding exceptional items, was EUR 72.7 million, 6.8% up on the same period of 2003 (EUR 68.1 million). The increase was achieved despite an adverse foreign exchange effect of EUR 3.8 million. Excluding this effect, the increase is 12.3 %.

The results in Asia and Latin America improved compared with 2003, despite adverse foreign exchange effects. Although the fall in the average exchange rate of the US dollar and related currencies of over 10% against the euro reduced this improvement when measured in euros, on balance the operating profit in euros of the Asia division grew by 3.8% and that of the Latin America division by 43.8%, partly due to the purchase of four terminals in 2003.

The result of the Oil EMEA division climbed by 23.4 % compared with the first half of 2003. The terminal in Tallinn, Estonia, processed record volumes and in Rotterdam, the terminal handled a high throughput of fuel oil. The gas oil and gasoline activities remain sluggish, particularly in Rotterdam, Sweden and Fujairah (UAE), owing to the high (spot) prices for oil products.

The results of the North America and Chemicals EMEA divisions were down on the same period of 2003. The chemical industry in North America remains tightly focused on further cost savings and efficiency improvements, which puts pressure on volumes. This division also has to contend with higher insurance costs. The Chemical EMEA division is experiencing a sharp decline in the spot storage of commodity chemicals, which mainly impacts results in the Netherlands.

Interest expense and tax fell by EUR 2.2 million and EUR 6.4 million respectively compared with 2003. The reduction in the item tax is mainly attributable to the release of a provision for deferred taxation because of a lower tax rate in Singapore. 

The net profit for holders of ordinary shares for the first half of 2004 amounts to EUR 34.0 million, an increase of 8.6% compared with 2003. The distribution of an optional dividend means that the number of Vopak’s outstanding ordinary shares has increased by 1.8% to 61,011,307 and net earnings per share amount to EUR 0.58 (first half 2003: EUR 0.54 per share).

Investments and funding

In the first half of 2004, Investments totalling EUR 73.5 million were made. This includes the construction of a large industrial terminal in Shanghai, China, the first phase coming on stream in Q4 2004, the expansion of the fuel oil facility at the Europoort terminal, Rotterdam, the purchase of a terminal in Tallinn, Estonia, and the construction of a new terminal in Darwin, Australia. 

The cash flow from operating activities amounted to EUR 32.3 million, which meant that net debt was EUR 517.2 million at 30 June 2004 (31 December 2003: EUR 608.5 million). The ratio of net debt to EBITDA came to 2.28 at 30 June 2004, representing a further improvement. Interest coverage at 5.6 was well above the threshold in the funding agreements of at least 4.  

IFRS

Preparations for the implementation of IFRS, the accounting rules applying from 2005 onwards, are on schedule.

Outlook

The weak US dollar and lack of signs of a recovery in the demand from the relevant chemical industries in Western Europe and North America will continue to put pressure on our core business in these areas, Vopak expects that, on balance, the operating profit for the third and fourth quarters of 2004, excluding exceptional items, will be comparable to that for the second quarter (EUR 38.6 million).

Barring unforeseen circumstances Vopak expects to achieve an operating profit on core activities excluding exceptional items for the full year approximately equal to that for 2003 (EUR 150 million).

Key figures

In EUR millions	H1 2004	H1 2003	% difference
Net turnover	318.9	371.1	-  14.1
Operating profit before depreciation and amortisation (EBITDA)	113.6	126.6	-  10.3
Operating profit (EBIT)	73.5	77.8	-    5.5
EBIT core activities excluding exceptional items	72.7	68.1	+   6.8
Net profit	37.5	34.8	+   7.8
Net profit for holders of ordinary shares	34.0	31.3	+   8.6
ROCE *) percentage	13.0	11.4
Earnings per share	EUR 0.58	EUR 0.54	+   7.4
Investments	73.5	58.1
Disposals	161.2	10.4
Net (disposals)/investments	(87.7)	47.7
	30-06-04	31-12-03	30-06-03
Shareholders' equity	558.0	521.2	475.5
Net debt	517.2	608.5	732.1
Average capital employed	1,132.9	1,336.0	1,363.4
Net debt : EBITDA	2.28	2.42	2.55
Interest cover	5.6	5.6	5.3
Current assets : current liabilities	1.7	1.4	1.1
Number of employees at end of period	3,473	4,004	4,057
*) ROCE = return on capital employed

Number of shares outstanding

Weighted average	58,545,836	58,313,375	58,308,849
Weighted average, fully diluted	58,639,014	58,461,497	58,308,849
Total, including treasury stock	61,011,307	59,927,972	59,927,972
Number of financing preference shares	25,400,000	25,400,000	25,400,000

Financial calendar

On 18 November 2004 after closure of the Stock Exchange, the results for the third quarter will be presented, and on 4 March 2005, the results for the 2004 financial year will be announced. The 2005 Annual General Meeting of Shareholders will be held on 28 April 2005. 

 

Profile
Royal Vopak is a global independent tank terminal group, operating some 20 million m3 capacity for the storage of liquid and gaseous chemical and oil products and providing complementary logistics services to meet market demand. Through strategic alliances with third-party logistics providers, the group also offers integrated logistics solutions.

Vopak is organized by market regions and operates more than 70 tank terminals in 29 countries.

For further information, please contact:

Royal Vopak
Corporate Communication & Investor Relations
Bon Ellemeet
Telephone : + 31 10 4002777

E-mail : corporate.communication@vopak.com
Web site : http://www.vopak.com/

 

Annexes:

1. Consolidated profit and loss account     

2. Consolidated balance sheet                           

3. Consolidated cash flow statement                                           

4. Review by division

Note The consolidated profit and loss account and the balance sheet have been prepared according to the same accounting rules and calculation methods used for the 2003 financial statements. The figures for the first half of 2004 have not been audited.

 

Annexe 1:     Consolidated profit and loss account

In EUR millions		30-6-2004		30-6-2003		2003
Net turnover		318.9		371.1		749.6
Other operating income		-0.3		0.4		3.0
Total operating income		318.6		371.5		752.6
Wages, salaries and social security charges		114.3		133.9		262.6
Depreciation and amortization		40.1		48.8		115.0
Other operating expenses		107.6		130.1		225.3
Total operating expenses		262.0		312.8		602.9
Operating profit		56.6		58.7		149.7
Profit of participating interests		16.9		19.1		42.5
Group operating profit		73.5		77.8		192.2
Interest		-22.4		-24.6		-47.9
Profit before taxation		51.1		53.2		144.3
Tax		-6.4		-12.8		-27.4
Consolidated net profit		44.7		40.4		116.9
Minority interests in consolidated net profit		-7.2		-5.6		-12.4
Net profit		37.5		34.8		104.5
Dividend on cumulative financing preference shares		-3.5		-3.5		-6.9
Net profit for holders of ordinary shares		34.0		31.3		97.6
Earnings per share		0.58		0.54		1.67
Fully diluted earnings per share		0.58		0.54		1.67
Earnings per share (before exceptional items)		0.55		0.52		1.28
Fully diluted earnings per share (before exceptional
items)		0.55		0.52		1.28
Specification group operating profit:
Group operating profit including exceptional items		73.5		77.8		192.2
Exceptional items		0.7		0.7		25.5
Group operating profit excluding exceptional items		72.8		77.1		166.7
Group operating profit discontinued operations		0.1		9.0		16.6
Group operating profit core activities		72.7		68.1		150.1

 

Annexe 2:  Consolidated balance sheet

 

In EUR millions			30-6-2004		31-12-2003		30-6-2003
Intangible fixed assets		5.7		6.6		4.4
Tangible fixed assets		903.2		994.8		1,053.9
Financial fixed assets		342.7		333.1		401.8
Deferred tax assets		2.7		5.4		5.1
Total fixed assets			1,254.3		1,339.9		1,465.2
Stocks		0.9		1.7		4.8
Debtors		202.8		232.2		229.3
Prepayments and accrued income		29.8		17.9		31.0
Securities		0.5		4.1		9.5
Cash at bank and in hand		172.1		152.4		142.3
Total current assets			406,1		408.3		416.9
Amounts owed to banks		16.1		37.0		56.2
Current portion of long-term liabilities		24.9		28.4		80.8
Pensions and other identical liabilities		0.6		4.9		5.1
Trade and other creditors		195.1		225.1		239.8
Dividends		3.5		6.9		3.5
Total current liabilities			240.2		302.3		385.4
Current assets less current liabilities			165.9		106.0		31.5
Total assets less current liabilities			1,420.2		1,445.9		1,496.7
Long-term liabilities			648.3		695.5		737.4
Pensions and other employee benefits		15.4		16.9		15.8
Provision for deferred tax liabilities		112.9		118.0		136.8
Other provisions		28.8		36.8		79.8
Total provisions			157.1		171.7		232.4
Minority interest in consolidated
shareholders’ equity		56.8		57.5		51.4
Shareholders’ equity		558.0		521.2		475.5
Group equity			614.8		578.7		526.9
Total			1,420.2		1,445.9		1,496.7

 

Equity movements

Balance at 31 December 2003			521.2
Movements:
-Optional dividend 2003		-29.2
-Paid in shares		25.0
-Paid in cash		-4.2
-Net profit		34.0
-Exchange rate differences		6.7
-Options exercised		0.3
Balance at 30 juni 2004			558.0
Ratios
		30-6-2004		30-6-2003		2003
Return on capital employed (ROCE)		13.0%		11.4%		14.4%
Current assets: Current liabilities		1.7		1.1		1.4
Net debt : EBITDA		2.28		2.55		2.42
Interest cover ratio		5.6		5.3		5.6

Annexe 3: Consolidated cash flow statement

 

In EUR millions			30-06-2004			30-06-2003			2003
Net profit		37.5			34.8			104.5
Adjustments for:
-Depreciation and amortization		40.5			48.8			99.9
- Write downs and impairments		-0.4			-			15.1
- Movements in provisions		-16.3			-2.1			-49.6
- Movements in minority interests		-2.0			1.8			5.8
- Distributed profit of participating interests		12.1			6.3			23.5
- Share in profit of participating interests		-16.9			-17.8			-36.5
- Result on sale of tangible fixed assets		-0.3			-0.4			-4.9
- Result on sale of group companies
and non-consolidated participating interests		-0.3			-0.9			-3.4
Gross cash flow from operating activities		53.9			70.5			154.4
Movements in working capital (excluding cash at
bank and in hand, short-term loans and dividends)		-19.9			33.4			50.8
Effect of changes in exchange rates		-1.7			2.2			-1.8
Net cash flow from operating activities			32.3			106.1			203.4
Capital expenditure:
- Tangible fixed assets		-58.7			-42.3			-106.5
Acquisitions (including goodwill):
- Financial fixed assets		-14.8			-8.6			-22.5
- Group companies		-			-7.2			-16.7
Total investments			-73.5			-58.1			-145.7
Disposals:
- Tangible fixed assets		4.0			6.2			26.2
- Financial fixed assets		18.1			4.2			39.8
- Group companies		139.1			-			32.8
Total disposals			161.2			10.4			98.8
Net cash flow from investing activities			87.7			-47.7			-46.9
Financing:
- Repayment of long-term liabilities		-48.0			-50.0			-50.4
- New long-term liabilities		0.2			2.3			3.7
- Options exercised		0.3			-			-
- Sale of repurchased shares		-			1.6			1.6
- Net movements in short-term financing		-34.1			16.8			-68.0
- Dividend distributions		-4.2			-30.0			-29.2
- Dividend on financing preference shares		-6.9			-6.9			-6.9
Net cash flow from financing activities			-92.7			-66.2			-149.2
Net cash flow			27.3			-7.8			7.3
Exchange and translation differences			1.5			-3.0			-7.9
Movements in cash at bank and in hand owing to
consolidations and deconsolidations			-9.1			-			-
Movements in cash at bank and in hand			-19.7			-10.8			-0.6

 

Annexe 4:  Review by division

 

Chemicals Europe, Middle East and Africa

In EUR millions	H1 2004	H1 2003	% difference
Net turnover	120.2	122.5	-   1.9
EBITDA	31.2	35.0	- 10.9
EBIT *)	16.9	19.2	- 12.0

*) excluding exceptional items

 

The fall in operating profit of the Chemicals EMEA division was mainly due to a steep decline in the spot storage of commodity chemicals in Rotterdam and Dordrecht. The results on gas storage in Vlissingen recovered and the results on the terminal activities in Antwerp, which focus more on speciality chemicals, likewise held up well. The results of the terminals in South Africa continued to improve, while those of the German (Hamburg) and Spanish participating interests maintained the levels of the previous year.

 

Oil Europe, Middle East and Africa

In EUR millions	H1 2004	H1 2003	% difference
Net turnover	62.6	56.6	+ 10.6
EBITDA	27.6	23.6	+ 16.9
EBIT *)	21.6	17.5	+ 23.4

*) excluding exceptional items

 

The 2004 results recovered well from the incident-plagued 2003 results, mainly thanks to record throughput at the participating interest in Tallinn, Estonia, and high throughput of fuel oil in Rotterdam. The demand for gas oil and gasoline storage in the Netherlands, Sweden and at the participating interest in Fujairah (UAE) lagged behind that of 2003. A large, long-term contract was concluded in Fujairah for the storage and delivery of bunker oil. The results came under pressure owing to the depreciation of the US dollar against the euro. The participating interests in Tallinn and Fujairah both report their income in US dollars. 

 

Asia

In EUR millions	H1 2004	H1 2003	% difference
Net turnover	45.4	45.7	-    0.7
EBITDA	39.6	34.8	+ 13.8
EBIT *)	27.5	26.5	+   3.8

*) excluding exceptional items

 

The limited decline in net turnover is fully attributable to adverse foreign exchange effects.

The improvement in operating profit is mainly thanks to improved results in Singapore, Thailand and Malaysia. The results on activities in other countries of the region (China, Japan, Korea and Pakistan) are comparable to those of 2003. In Q4 2004, the first phase of the new industrial terminal in Shanghai, China, will come on stream, but will not contribute to the 2004 results.

North America

In EUR millions	H1 2004	H1 2003	% difference
Net turnover	48.3	51.6	-   6.4
EBITDA	13.5	17.2	- 21.5
EBIT *)	7.7	11.5	- 33.0

*) excluding exceptional items

 

In the chemical industry of North America, cost savings and efficiency improvements are still major factors. The results of the large Vopak terminal in Deer Park, Houston, are especially impacted by them. The North America division also has to contend with higher insurance costs.

Latin America

In EUR millions	H1 2004	H1 2003	% difference
Net turnover	22.7	17.5	+ 29.7
EBITDA	11.1	8.1	+ 37.0
EBIT *)	9.2	6.4	+ 43.8

*) excluding exceptional items

 

The increase in net turnover is largely attributable to the terminals in Venezuela, Colombia and Ecuador acquired in mid-2003. Measured in local currencies and US dollars, the increase in net turnover at the other terminals in the region is partly being eroded by adverse foreign exchange effects. The increase in operating profit is mainly attributable to the new terminals and improved results in Mexico. Results in the other countries of the region (Brazil, Chile and Peru) were about the same as for 2003.