professionals in liquid bulk logistics - vopak.com · low sulphur levels in gasoline, diesel and...

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Professionals in liquid bulk logistics

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Annual Results 2006

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Executive Board

Jack de Kreij John Paul Broeders Frans de Koning

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Agenda

▢ Achievements 2006

▢ Mission, Strategy, Future

▢ Oil products’ trade flows 2010

▢ Business performance FY 2006

▢ Performance divisions FY 2006

▢ Outlook

5

2006: A Good Year for Vopak

100

150

200

250

2005 2006

500

600

700

800

2005 2006

70

100

130

160

2005 2006

EBIT

Net Revenues

EPSNet Profit

1

2

3

2005 2006

6

Commercial Excellence

250

275

300

325

350

375

400

1H 2H 1H 2H 1H 2H

2004 2005 2006

80%

85%

90%

95%

2004 2005 2006

Average occupancyrates

Income from rendering of services

In m

lnEU

R

core activities

7

Operational Excellence

0123456

02 03 04 05 06

LTIR

Spills

0

20

40

60

80

100

120

04 05 06

8

CaojingBanyan Vietnam

Chile

Commissioned Greenfields, Expansions and Acquisitions

Darwin Ulsan

Al JubailAlemoa Barranquilla

2006: stopped merger process Vopak ITC

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Confirmed Projects

Europoort

Antwerp

Zhangjiagang

Construction

Sydney

Fujairah

Announced investigation

Amsterdam

Banyan

Lanshan

LNG (R’dam)

Sebarok

Banyan Biodiesel

CaojingAltamira

Venezuela

London

Rotterdam Biodiesel

Botlek

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Future Gate Terminal Viewed from the East

LNG channel

LNG storage& process

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EBITDA Range Reached

€ 350 mln

€ 275 mln

2004 2005 2006

12

Agenda






▢ Outlook

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A Challenging Environment

Market Growth

CustomerPerception

Profitability+

Market Position

Organisation

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Vopak’s MissionTo give inspiration and a sense of direction for the future.

• Dedicated to our customer success by serving the storage needs of global and local clients

• Continue to drive excellence• Growing profitable from the core• Successfully execute major projects• Strengthen required capabilities• Setting the standard on Safety, Health, Environment and Quality

Vopak aspires to be the world’s greatest terminal company for liquid chemicals, oil products and gasses, admired by its strategic partners for an outstanding corporate reputation.

Through a entrepreneurial, goal-oriented and agile network organisation

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Cost Efficient Operations

Customer Leadership

Strategic Focus Vopak

Growth Leadership

Pursue and strengthen leadership in key locations

Invest in partnerships with strategic customers

Attain service excellence across the network

Become preferred provider for strategic accounts

Attain low cost position compared to key

competitors

Develop superior ability to withstand all economic

conditions

Leadership EnablersAlign structure with strategy and improve supply of human capital

ExcellenceSet new standards in commercial operational and financial excellence

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Strategy Targets

Grow faster than

the market

Storage provider

of choice

Cost Efficient

Operations

& Profitable

Growth

17

Agenda






▢ Outlook

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Oil Developments

Intensification of geographicalimbalances between demandand supply

Product differentiation: low sulphur levels in Gasoline, Diesel and Fuel Oil

Liberalisation of new markets

Emerging economies in China and India

Middle East Major Refining Projects

Saudi Arabia

Al Jubail400KBD

Saudi ArabiaYanbu

400KBD

Saudi ArabiaRabigh500KBD

QatarRas

Laffan250KBD

UAEFujairah500KBD

KuwaitShuaiba300KBD

IranVarious400KBD

KBD = Thousand Barrels Per Day

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Global Naphtha Net Trade

2010 Net trade flow

The major changes in Naphtha trade by 2010 are an increasing Middle East surplus and deepening Asia deficit.

Increased need for storage MiddleEast and AsiaHub functions will growNaphtha is mainly a feedstock forchemical production >>storage forchemical derivatives

Impact on VopakSingapore Banyan Terminal wellpositioned to benefit fromincreased chemical production

Vopak’s Projects

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Global Gasoline Net Trade

2010 Net trade flow

Key new net trade flow in 2010

Europe, as the main surplus region in 2010, is likely to export gasoline to Asia and America.

Increased need for blendingIncreased need for storage, bothon the import and export sideHub functions will growStrategic locations

Impact on VopakNew Amsterdam Terminal plannedExpansion Sebarok Terminal

Vopak’s Projects

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Global Jet/Kerosene Net Trade

2010 Net trade flow

In 2010, the Middle East will become a dominant global supplier of jet/kero. It is likely to be the major source of supply to growing European deficit.

Increased need for storageDevelop hub functionsStrategic locations

Impact on VopakExpansion at Europoort Terminal

Vopak’s Projects

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Global Fuel Oil Net Trade

2010 Net trade flow

Europe’s imports from the FSU will be sustained, possibly at the expense of FSU exports to North America.

Increased need for blendingIncreased need for storageHub functions will grow

Impact on VopakExpansion at Europoort TerminalExpansion at Sebarok Terminal

Vopak’s Projects

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Agenda






▢ Outlook

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Summary of Market Developments

• Product differentiation• Increasing geographical

imbalances between demand and supply

• Liberalisation of new markets

• Increasing demand for storage• Build-up of new petrochemical

complexes in Asia and Middle East

Oil: Chemicals:

LNG:

• More focus on LNG solutions as energy source

• LNG growth rates since 2000: >6% per annum

Bio fuels:

• Government requirements• Increased producers’ interest in

bio fuels due to subsidies and incentives

Emerging economies in China and India

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232

220.9

1.96

↑ 21.7%

2006 In Line with Ambitious Outlook

* EBITDA includes joint ventures results **excluding exceptional items

EUR 275-350

FY 06 Outlook/GuidanceEUR (mln)

EBIT**

EPS** (EUR)

CAPEX (EUR mln)

309.8EBITDA*

around EUR 220

↑ around 10% per annum

around EUR 250

FY 05

253.5

179.7

160.3

1.61

↑ 16.8%

Net cash flow fromoperating activities

164.3 225.3

Capacity (Gross, cbm)

Safety: LTIR-ratio20.4

2.7

21.2

1.9

26

170.7

1.46

90.2

2.08

216.6

129.4

Robust Financial Performance FY 2006: 27% EBIT Increase

All figures are including exceptional items

* attributable to holders of ordinary shares

14%

43%

42%

FY 05 FY 06 ∆%EUR (mln)

EBIT

Net Profit*

EPS (EUR)

778.1Net Revenues 683.6

27%

ROCE (%) 19.416.5

Net Revenues

500

600

700

800

2003 2004 2005 2006

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All Divisions Contributed to 14% Increase in Net Revenues

CEMEA

Asia

Latin America

North America

05 06

OEMEA

296.6263.9

143.7 165.1128.2118.2

51.9

97.5 121.4

05 06

05 06

05 0605 06

61.8

8% 15%

19% 12%

25%

28

179.7

1.61

99.5

1.96

220.9

122.2

FY 2006: 23% EBIT Increase excl. Exceptionals

All figures are excluding exceptional items

* attributable to holders of ordinary shares

23%

23%

22%


EBIT

Net Profit*

EPS (EUR)

314.2EBITDA 262.4 20%

EBIT

100

140

180

220

260

2003 2004 2005 2006

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FY 2006: 41.2 mln Increase in EBIT*

CEMEA

Asia

Latin America

North America

05 06

OEMEA

44.660.7

57.6 62.7

25.520.6

16.3 19.9

59.974.9

*EBIT excluding exceptional items

-19.3 -22.8

Other

05 06

05 06

05 06

05 06

05 06

24% 9%

25%

22% 36% 18%

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- 39.3

- 12.6

- 25.6

-15.0

- 44.2

- 25.5

Strong Earnings DeliveryEPS: increase by 42%

** including exceptional items *** attributable to holders of ordinary shares

27%

0.4%

19%


Financing charges

Tax

Minority interests

216.6EBIT** 170.7

12%

Net profit*** 129.490.2 43%

42%EPS** (EUR) 1.46 2.08

EPS

1

1,5

2

2,5

2003* 2004 2005 2006

* based on Dutch GAAP

31

2,20

2,42

2,49

1,76

0 0,5 1 1,5 2 2,5 3 3,5 4

2002*

2003*

2004

2005

2006

2007

3,75

Strategic Finance: Sufficient Flexibility

* based on Dutch GAAP

Maximum Ratio under US PP

Net debt : EBITDA ratio

Maximum Ratio under other loans and syndicated revolving credit facility

1.61

׀

32

70%

11%

7%

6% 6%

US Private Placements

• USD 400 mln, GBP 35 mln, EUR 8 mln• Average remaining term of 4.3 years• Maximum remaining term is 10 years• The ratio net debt to EBITDA may not exceed:

– 3.00 (July 1, 2004 – June 30, 2007)– 2.75 (from July 1, 2007)

USPP

Vopak Terminals Singapore

Other PP

Other DebtRevolvingCredit Facility

Vopak Debt Structure

AmendmentMarch 2007

AmendmentMarch 2007

3.753.75

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Strategic Finance: Solid Equity Position

Shareholders’ equity

Net Debt

* based on Dutch GAAP** Restructuring preference shares: -50.3 and IFRS adjustment: -44.7

EUR (mln)

**

496 521 500 604 671

200

300

400

500

600

700

800

2002* 2003* 2004 2005 2006

504785 618 509 472

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0

50

100

150

200

250

300

350

Sources Uses Sources Uses

Sources and Uses of Cash

Operations Operations

Investments

Divestments

Investments

Divestments

FinancingFinancing

ProposedDividends

Dividends

2005 2006+43.9 -64.8

EUR (mln)

35

Operational Net Free Cash Flow2006: increased by 37%

0

50

100

150

200

250

2005 2006

EUR (mln)

37 %

Cash Source

164.3

225.3

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Investments*2006: increased by 43%

0

100

200

300

2005 2006

EUR (mln)

Worldwide capacity increased by 783.300 cbm in 2006

* including Maintenance and SHE CAPEX

43 %

187.5

267.6

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Investing in Asset Reliability & Growth

Optimising existing capacity

Expansion at existing terminals

Acquisitions, mergers and joint ventures

New terminals at new locations

Development of concepts fornew products

Growth Maintenance & SHE CAPEX

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0,00

0,25

0,50

0,75

1,00

2002 2003* 2004* 2005 2006

Step Up in Dividends2006: increased by 25%

* Optional in cash or ordinary shares

• Proposed dividend in 2006 amounts to EUR 0.75 per ordinaryshare. This reflects 36% of EPS (2005: 41%).

Proposeddividend

0.50 0.50 0.50 0.600.75

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100

150

200

250

2005 2006

SUMMARY: A Strong Year for Vopak

2006 FINANCIAL PERFORMANCE• Strong environment and operating performance• Net Revenues of EUR 778.1 mln (+14%)• EBIT excluding exceptionals of EUR 220.9 (+23%)• EPS excluding exceptionals of EUR 1.96 (+22%)

STRATEGIC FINANCE• US Private Placement programme• Strong equity position

500

600

700

800

2005 200670

100

130

160

2005 2006

EBITNet Revenues Net Profit

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Agenda






▢ Outlook

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Division: Chemicals EMEA

“Exploiting new market trends”

* excluding exceptional items

10,812,910,710,2 13,1 14,3 17,6 15,7

02468

101214161820

Q1 Q2 Q3 Q4

20052006

EBIT* (mln)

28% 34% 36% 45%

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Division: Oil EMEA

“Enlarge hub functions”


14,215,714,313,4 16,3 15,4 17,8 13,2

02468

101214161820

Q1 Q2 Q3 Q4

20052006

EBIT* (mln)

22% 8% 13% 7%

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Division: Asia

“Plan, build, operate”


13,8 14,9 14,4 16,8 19,218,820,016,9

02468

101214161820

Q1 Q2 Q3 Q4

20052006

EBIT* (mln)

22% 34% 31% 14%

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4,5 4,9 5,4 5,8 7,26,26,7 5,4

02468

101214161820

Q1 Q2 Q3 Q4

20052006

EBIT* (mln)

Division: North America

“Reorient and optimise”


49% 10% 15% 24%

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Division: Latin America

“Network expansion step by step”


5,03,83,54,0 5,05,4 4,1 5,4

02468

101214161820

Q1 Q2 Q3 Q4

20052006

EBIT * (mln)

35% 43% 8% 8%

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SUMMARY2006: All divisions contributed to the 23% increase in EBIT*

CEMEA

30

40

50

60

70

2003 2004 2005 2006

OEMEA

30

40

50

60

70

2003 2004 2005 2006Asia

40

50

60

70

80

2003 2004 2005 2006

North America

10

15

20

25

30

2003 2004 2005 2006

Latin America

10

15

20

25

2003 2004 2005 2006

*excluding exceptional items

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Agenda






▢ Outlook

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19

20

21

22

23

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2005 2006 2007 2008 2009

Addition

Capacity

Vopak’s Capacity Growth

• Successful improvement steps on road to excellence• Further growth continues worldwide• Pipeline well-filled with potential and ongoing projects

??

X 1,

000,

000

cbm ?

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2002* 2003* 2004 2005 2006 2007

CAPEX 2002 – 2006 & Outlook 2007**

* based on Dutch GAAP**including Maintenance and SHE CAPEX

(In)Tangible fixed assets

97 106.5 124.9 160.3232

450 - 550

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Outlook EBIT 20072007 (March 9, 2007)

Short-term outlook• Vopak will globally add more than 1.7 million cbm in storage capacity during

2007 and 2008• Vopak expects total capital expenditures between EUR 450 million and

EUR 550 million in 2007, including expenditures for maintenance, safety and environment

Long-term guidance• Vopak is increasing its long-term guidance and aiming for a yearly Group

operating profit before depreciation and amortization (EBITDA) of between EUR475 million and EUR 550 million in five years’ time (was between EUR275-350 million)

• The strategic long-term target for Return On Capital Employed remains unchanged at around 16% for the Group as a whole

Unforeseen circumstances include, but are not limited to, exceptional income and expense items, unexpected economic, political and foreign exchange developments, and possible changes to IFRS reporting rules.

• Baring unforeseen circumstances, Vopak expects to realise a Groupoperating profit excluding exceptional items of at least 10% higher in 2007

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179.7

160.3 232

220.9

Outlook Summary

* EBITDA includes joint ventures & associates results **excluding exceptional items

475-550

FY 2005 FY 20065 year plan

(2011)EUR (mln)

EBIT**

CAPEX

309.8EBITDA* 253.5

ROCE 19.4%16.5% Around 16%

OutlookFY 2007

At least10%higher

450-550

Long-term

Baring in mindsubstantial investmentsin greenfield projects/

expansions

Baring in mindsubstantial investmentsin greenfield projects/

expansions

Guidance

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This presentation contains statements of a forward-looking nature, based on currently available plans and forecasts. Given the dynamics of the markets and the environments of the 30 countries in which Vopak renders logistics services, the company cannot guarantee the accuracy and completeness of such statements.

Unforeseen circumstances include, but are not limited to, exceptional income and expense items, unexpected economic, political and foreign exchange developments, and possible changes to IFRS reporting rules.

Statements of a forward-looking nature issued by the company must always be assessed in the context of the events, risks and uncertainties of the markets and environments in which Vopak operates. These factors could lead to actual results being materially different from those expected.

Forward-looking statement

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Thank you for your attention!

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