Vopak reports on FY 2021 and Q4 2021 financial results
Rotterdam, the Netherlands, 16 February 2022
|Q4 2021||Q3 2021
|In EUR millions||2021||2020
|Results -excluding exceptional items-|
|212.5||210.8||185.9||Group operating profit before depreciation and amortization (EBITDA)||826.6||779.7|
|121.9||127.9||106.5||Group operating profit (EBIT)||494.8||483.7|
|69.1||80.6||55.2||Net profit attributable to holders of ordinary shares||298.3||299.5|
|0.55||0.64||0.44||Earnings per ordinary share (in EUR)||2.38||2.37|
|Results -including exceptional items-|
|206.5||201.4||156.9||Group operating profit before depreciation and amortization (EBITDA)||741.5||777.6|
|115.9||118.5||77.5||Group operating profit (EBIT)||409.7||481.6|
|64.1||71.3||22.5||Net profit attributable to holders of ordinary shares||214.2||294.6|
|0.51||0.57||0.18||Earnings per ordinary share (in EUR)||1.71||2.33|
|313.1||166.0||265.7||Cash flows from operating activities (gross excluding derivatives)||786.2||751.5|
|312.2||166.9||266.0||Cash flows from operating activities (gross)||741.2||810.4|
|- 139.7||- 160.2||- 314.7||Cash flows from investing activities (including derivatives)||- 588.4||- 572.7|
|Additional performance measures|
|250.6||257.3||241.5||Proportional EBITDA -excluding exceptional items-||999.6||960.5|
|22.5||22.5||22.0||Proportional capacity end of period (in million cbm)||22.5||22.0|
|86%||88%||91%||Proportional occupancy rate||88%||90%|
|36.2||36.1||35.6||Storage capacity end of period (in million cbm)||36.2||35.6|
|86%||87%||90%||Subsidiary occupancy rate||87%||88%|
|9.6%||10.4%||10.9%||Return on Capital Employed (ROCE)||10.2%||11.4%|
|5,150.2||4,783.4||4,167.2||Average capital employed||4,755.1||4,159.4|
|2,925.1||2,979.4||2,589.4||Net interest-bearing debt||2,925.1||2,589.4|
|2.93||2.93||2.58||Senior net debt : EBITDA||2.93||2.58|
|3.16||3.16||2.81||Total net debt : EBITDA||3.16||2.81|
The prior periods related to financial year 2020 have been restated, due to mandatory full retrospective application of a change in accounting policy for the IFRIC agenda decision made in March 2021 on Cloud Computing Arrangements.
Highlights for FY 2021 and Q4 2021 -excluding exceptional items-:
- Full year 2021 EBITDA of EUR 827 million (FY 2020: EUR 780 million). Adjusted for EUR 6 million negative currency translation effects, EBITDA increased by EUR 53 million (7%). Growth project contribution is driving positive EBITDA performance (EUR 50 million) in soft business conditions.
- Proportional occupancy rate of 88% (FY 2020: 90%) reflecting soft market conditions in oil and chemicals in the Netherlands and Singapore.
- Costs at EUR 611 million, including the cost for growth projects and business development efforts and after adjustment for currency movements (EUR 10 million) and changes in accounting policy (EUR 7 million) in line with our previously announced ambitions of managing costs below EUR 615 million. Reported costs amounted to EUR 628 million (2020: EUR 603 million).
- EBIT of EUR 495 million (FY 2020: EUR 484 million) increased driven by EBITDA growth partly offset by higher depreciation related to sustaining capex investments and new capacity delivered.
- Return on capital employed (ROCE) of 10.2% (FY 2020: 11.4%) reflects high capital investments.
- Net profit attributable to holders of ordinary shares of EUR 298 million (FY 2020: EUR 300 million) driven by higher EBIT and lower income tax, which was more than offset by higher financing cost mainly due to less capitalized interest.
- Cash Flow From Operations (CFFO) (excluding derivatives) of EUR 786 million grew compared to last year EUR 752 million (5% year-on-year) including contribution from new growth projects. Excluding derivatives impact and working capital movements, CFFO increased by EUR 42 million (6% year-on-year).
- Earnings per ordinary share (EPS) of EUR 2.38 (FY 2020: 2.37).
- A dividend of EUR 1.25 (2020: EUR 1.20) per ordinary share, payable in cash, an increase of 4%, will be proposed during the Annual General Meeting on 20 April 2022.
- The Senior net debt: EBITDA ratio is 2.93 at the end of FY 2021.
- Fourth quarter 2021 EBITDA amounted to EUR 213 million (Q4 2020: EUR 186 million) including EUR 10 million reclass from withholding tax on undistributed reserves of associates and joint ventures to the income tax line. Year-on-year comparison was impacted among others by the one-off negative accounting result of EUR 20 million recognized in Q4 2020 in our associate industrial terminal in Malaysia (PT2SB) and higher energy and utility costs in Q4 2021.
- Growth momentum continued with the delivery of new capacity of 124,000 cbm during Q4 2021 at Sydney and Deer Park.
- Vopak announced that it has reached an agreement with MOL (Mitsui O.S.K. Lines Ltd) to jointly own and operate the FSRU for the new LNG terminal in Hong Kong.
Exceptional items FY 2021:
- Total exceptional losses included in net profit amounted to EUR 84 million (2020: exceptional losses of EUR 5 million). This mainly consisted of impairment of our Panama terminal. Other exceptional items were related to a write-off of business development costs in our joint venture Vopak Moda Houston and of our German LNG project, partial dilution of our Chemtank share and a partial release of a tax provision in a joint venture terminal within the Asia & Middle East division.
For a full overview of the exceptional items, reference is made to Enclosure 4g.
- Vopak Ventures has made more than 10 investments in start-ups and scale ups over the past two years in the field of operational excellence and asset management, sustainability and new energy as well as digital and platforms. This includes positions in hydrogen equipment and solar and plastic recycling.
- Vopak is on track with the prior announced target of EUR 110 million to EUR 125 million EBITDA contribution in 2023 from growth projects.
- We expect to manage the 2022 cost base including additional cost for new growth projects around EUR 645 million, subject to currency exchange and utilities price movements.
- In 2022, growth investments are expected to be below EUR 300 million. The allocation of these investments will be through existing committed projects, new business development and pre-FID (Final Investment Decision) feasibility studies in new energies including hydrogen, the planned Aegis Vopak transaction and the investment related to the new LNG terminal in Hong Kong in 2022.
- For the period 2020-2022, Vopak expects to be at the higher end of the range EUR 750 million to EUR 850 million for sustaining and service improvement capex, subject to additional discretionary decisions, policy changes and regulatory environment.
- As part of the strategic direction for the period 2020-2022, Vopak indicated to invest annually up to a maximum of EUR 45 million (updated to reflect changed accounting for Cloud Computing Developments) in IT capex, to complete Vopak’s digital terminal management system. We expect to complete the roll out of our Vopak Terminal System to our terminal network and Joint Ventures by the end of 2023 which now includes our new terminals.
Royal Vopak Chief Executive Officer Dick Richelle comments:
“2021, like 2020, was an atypical year due to the pandemic -- with high volatility and lower demand for storage across the industry due to tight supplies. Vopak has again proven its resilience and ability to continue delivering while adapting to change and further improving our performance in safety and service to our best level yet. We delivered close to record high EBITDA and continued the delivery of the growth projects.
We realized good progress on our portfolio and growth agenda by actively positioning ourselves towards the future. We reached new milestones in industrial terminals, mainly on the US Gulf Coast and China. We delivered new storage capacity and infrastructure in main industrial clusters in Belgium, Mexico, USA, the Netherlands, Australia.
Gate terminal, our successful joint venture with Gasunie for LNG in Rotterdam, is making an important contribution to the security of natural gas supplies in the Netherlands and Northwest Europe supplying the equivalent of 25% of the Netherlands’ gas needs. Gate terminal will add 12.5% additional send out capacity to serve increased demand by the end of 2024.
On sustainability, we are ambitious and performance driven. We updated our sustainability roadmap to navigate us in the coming years. Our roadmap establishes a balanced approach with 12 key topics focusing on care for people, planet and profit. On safety, the cornerstone of our sustainability policy, we had no major incidents in 2021 and continued to improve our performance versus previous years recording our best year yet.
We contribute to a more sustainable world by actively innovating and investing in infrastructure for the introduction of the new vital products of the future.
We are working hard on the progress towards starting up our new joint venture in India in 2022. As the Indian government has earmarked LPG to provide cleaner and safe cooking fuels for households, we are joining forces with Aegis to create one of the largest independent tank storage companies for LPG and chemicals in the country. We reached an agreement with Mitsui O.S.K. Lines to jointly own and operate the floating storage and regasification unit for the new offshore LNG terminal in Hong Kong to support Hong Kong Special Administrative Region (HKSAR) government’s target to improve air quality and environmental conditions by increasing the percentage of power generation by natural gas.
As the pace of change accelerates, we are excited about our positioning towards the many opportunities ahead. In 2021, we continued our progress of infrastructure solution opportunities and resource allocation to hydrogen, ammonia, CO2, flow batteries, biofuels and sustainable feedstocks.
Building on our experience in storing and handling ammonia at five other locations around the world, we commissioned ammonia operations in the new Vopak Moda Houston terminal with VLGC (Very Large Gas Carriers) shipping capacity. This positions us well to contribute to future flows of ammonia, which can be used as a hydrogen carrier, a shipping fuel or a feedstock. We also work with various partners on setting up new hydrogen supply chains via various technologies -- liquid organic hydrogen carriers to enable hydrogen imports from various potential locations into Northern Europe, and liquefied hydrogen in the long run, to, for instance, Singapore.
For 2022 and beyond, we will remain true to our purpose: storing vital products with care. In doing so, supported by our financial performance, we will continue to make a meaningful contribution to our customers and to society."
Link to video of CEO and CFO commenting on Vopak's FY 2021 results
About Royal Vopak
Royal Vopak is the world’s leading independent tank storage company. We store vital products with care. With over 400 years of history and a focus on sustainability, we ensure safe, clean and efficient storage and handling of bulk liquid products and gases for our customers. By doing so, we enable the delivery of products that are vital to our economy and daily lives, ranging from chemicals, oils, gases and LNG to biofuels and vegoils. We are developing key infrastructure solutions for the world’s changing energy and feedstock systems, while simultaneously investing in digitalization and innovation. Vopak is listed on the Euronext Amsterdam and is headquartered in Rotterdam, the Netherlands. For more information, please visit vopak.com.
For more information please contact:
Vopak Press: Liesbeth Lans - Manager External Communication,
Vopak Analysts and Investors: Fatjona Topciu - Head of Investor Relations,
The analysts’ presentation will be given via an on-demand audio webcast on Vopak’s corporate website, starting at 10:00 AM CET on 16 February 2022.
This press release and enclosure 4 are based on the 2021 financial statements. The financial statements are published in accordance with statutory provisions. The auditor has issued an unqualified auditor’s report on the Financial Statements.
This press release contains inside information as meant in clause 7 of the Market Abuse Regulation.