|
Rotterdam, the Netherlands, November 19, 2004
Results Koninklijke Vopak N.V. (Royal Vopak) announces that its operating profit on core activities excluding exceptional items for the third quarter of 2004 amounted to EUR 39.5 million (2003: EUR 40.3 million). Adjusted for a foreign exchange loss of EUR 0.9 million, the operating profit was virtually the same as that for the corresponding period in 2003. The operating profit of the Chemicals EMEA and North America divisions stabilised in the third quarter at around the levels of the first two quarters of 2004. The favourable operating developments at the Asia, Oil EMEA and Latin America divisions as reported earlier continued. This resulted in an operating profit for the third quarter of EUR 0.9 million higher than that for the second quarter of 2004, despite the weaker dollar.
Net debt at the end of September 2004 amounted to EUR 496.0 million (year-end 2003:
Barring unforeseen circumstances, Vopak continues to expect that it will achieve an operating profit on core activities excluding exceptional items for the whole of 2004 of around EUR 150 million.
The demand for chemicals storage capacity in Rotterdam and North America increased towards the end of the third quarter, partly owing to one-off contracts on the spot market. In addition, positive developments on the chemicals markets are encouraging manufacturers to increase production and build up their stock positions. This has led to a small increase in the demand for storage capacity and in the throughput at the Rotterdam and North America chemicals hub terminals in October and November. Ongoing imbalances between production location and consumption location on the oil market have boosted the demand for oil storage capacity. This was made more pronounced as a result of the increased consumption of fuel oil in China. Furthermore, the bunker markets in Rotterdam and Singapore showed signs of improvement. These developments are expected to continue.
Compared with the same period last year, the turnover of the Chemicals EMEA division increased in virtually all areas, with the exception of inland tanker barging. The results achieved on the storage of animal and vegetable oils and fats in Vlaardingen improved compared with the third quarter of 2003. The third quarter operating profit of the division amounted to EUR 8.4 million (2003: EUR 9.6 million), partly owing to non-recurring costs. The investment programme for the fuel oil infrastructure at Europoort, which was launched in 2003, was virtually completed in the third quarter of 2004 and the available capacity is now being fully used. Mainly thanks to the additional turnover, the operating profit of the Oil EMEA division for the third quarter increased further to EUR 14.0 million (2003: EUR 11.6 million). The operating profit for Asia amounted to EUR 13.6 million, compared with EUR 14.1 million for the third quarter in 2003. After adjusting for foreign exchange effects of EUR 1.0 million, the improvement on 2003 can be attributed mainly to better results on oil and chemicals storage in Singapore. In October, the first part of stage one of the industrial terminal in Caojing (near Shanghai) in China came on stream. This terminal is expected to make a contribution to profit as early as 2005. In North America, the increase in turnover expressed in local currency was not sufficient to offset the higher expenses. The operating profit, including a foreign exchange loss of EUR 0.5 million, fell to EUR 3.3 million from EUR 5.0 million for the third quarter of 2003. Despite a foreign exchange loss of EUR 0.4 million, Vopak Latin America saw its operating profit increase to EUR 4.2 million (2003: EUR 4.1 million). This improvement was spread evenly over the entire continent.
The annual results for 2004 will be announced on 4 March 2005. The annual General Meeting of Shareholders will be held on 28 April 2005.
1 Breakdown of operating profit
Profile For further information, please contact: 1. Breakdown of operating profit
2. Exchange rates
3. Application of International Financial Reporting Standards (IFRS) Introduction With effect from the 2005 financial year, Koninklijke Vopak N.V. (Royal Vopak) will prepare its financial reports in accordance with IFRS. The comparative figures for 2004 will therefore also be presented on the basis of the applicable IFRS principles. The IFRS standards that should or can be applied in the 2005 financial statements have not all been finalised and endorsed by the European Commission yet. Accordingly, the accounting policies used to prepare the preliminary IFRS opening balance sheet at 1 January 2004 might be different from the policies that will be used for preparing the 2005 financial statements and comparative figures for 2004. The impact of the transition from the current accounting standards to IFRS on shareholders’ equity and results can therefore only be provisionally determined at this time. While bearing the preliminary nature in mind, the main differences for Vopak between the current accounting standards (Dutch GAAP) and IFRS are summarised below.
The main changes as a result of the first-time application of IFRS and the resulting impact on shareholders’ equity at 1 January 2004 are as follows: A. Financial instruments (IAS 32 and IAS 39) IAS 32 and IAS 39 set out rules for the treatment of financial instruments, including loans from and to third parties and instruments used to hedge financial risks. These standards have not yet been endorsed by the European Commission. Under a temporary exemption for IAS 32 and IAS 39, the comparative figures for 2004 need not be adjusted to comply with these two standards. This option means that the two standards can be applied as from 1 January 2005, instead of 1 January 2004. The application of IAS 32 and IAS 39 would require Vopak to value its financial instruments used to hedge interest rate and currency risks at market value. In addition it is also possible that the cumulative financing preference shares will no longer qualify as equity, but as loan capital. Vopak is currently looking into whether it should continue the current programme of cumulative financing preference shares and, if so, in what form. In view of this, Vopak will make use of the temporary exemption and apply these standards in its 2005 financial statements as from 1 January 2005. This postponement to 2005 means that IAS 32 and IAS 39 will not impact shareholders’ equity at 1 January 2004. B. Pensions (IAS 19) Since 2002, Vopak’s pension charges have been calculated under Dutch GAAP in accordance with IAS 19. Accordingly, the 2002 and 2003 financial statements included disclosure of the unrecognised actuarial gains and losses in the notes, stating among other things that the pension figures would be adjusted to comply with the applicable standards on the full application of IFRS in the future. In practice, this means that the net unrecognised actuarial loss under Dutch GAAP at 31 December 2003 of EUR 65.5 million will be charged, net of tax, to reserves in the IFRS opening balance sheet. This will have a net downward impact on shareholders’ equity at 1 January 2004 of C. Goodwill (IFRS 3) Besides the above charges to shareholders’ equity, Vopak could report an increase in shareholders’ equity if it decided to adopt the policy permitted under IFRS to capitalise goodwill previously charged to reserves and to revalue certain fixed assets. At present, Vopak does not intend to apply this policy in preparing its 2005 financial statements. Impact on the 2004 profit and loss account The aforementioned changes under IFRS will have a limited impact on the 2004 profit and loss account. |
 |
|
|
|
|
|
 |
|
|
|
|
|
|
|
|
|
Vopak: Third quarter operating profit on core activities in line with 2003
