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Vopak earnings, sales plunge, continues with positioning for energy transition

February 18/2021

MOSCOW (MRC) -- Vopak (Rotterdam, Netherlands) reports a 76% fall in net profit including exceptional items to EUR24.0 million (USD29.0 million) for the fourth quarter of 2020, despite a slight rise year on year (YOY) in sales to EUR303.7 million. Net earnings are also down 69% sequentially on the third quarter, with sales falling marginally, said Chemweek.

Excluding exceptional items, net profit fell 39% YOY to EUR56.8 million and 31% sequentially. Vopak says fourth-quarter EBITDA of EUR159.8 million, including exceptional items, was down 21% compared to the prior-year period and 18% sequentially. Excluding exceptional items but impacted by a one-off accounting loss of EUR20 million related to its associate terminal in Malaysia, EBITDA was EUR188.8 million, it says.

Vopaks total storage capacity in the fourth quarter rose by 1.2 million cubic meters YOY to 35.6 million cu meters, with an average storage occupancy rate of 91%, up 6% YOY, but down slightly sequentially. For 2021 the company says new contributions from ongoing and planned growth projects, replacing EBITDA from divested terminals, could add between 30-50 million, subject to market conditions and currency exchange movements. Between 300-350 million is planned for growth investments in 2021 through existing committed projects, new business development, and pre-FID feasibility studies in new energies, including hydrogen, it says.

We aim to allocate the majority of our growth investments to industrial, gas, and new energies infrastructures. Our positive views on chemicals have not changed. New growth investments in oil infrastructure are expected to be reduced and will mostly be targeted towards strengthening our leading hub positions, says Vopak CEO Eelco Hoekstra.

Vopak also announced it will expand its Vlaardingen terminal in the port of Rotterdam, Netherlands, for the storage of waste-basted renewable feedstocks, mostly for the production of biodiesel and bio-jet fuel. A total of 16 storage tanks with a combined capacity of 64,000 cu meters will be constructed, it says. The project is expected to be completed in the fourth quarter of 2022. It will also expand its terminal services in Qinzhou, China, by constructing a new jetty, to be used exclusively for propane, butane, ethylene, and propylene. The project is scheduled for completion in the second half of 2022, it says.

We have momentum in capturing opportunities to serve large-scale industrial clusters, and are advancing our efforts in developing infrastructure to support the energy transition, says Hoekstra. The company will continue to transform its portfolio and position itself towards more sustainable forms of energy and feedstocks, he says.

For the full-year 2020, Vopak reports net profit including exceptional items of EUR300.9 million, a YOY fall of 47%, on sales that declined 4% to 1.19 billion. Excluding exceptional items, net income fell 15% YOY to 305.8 million. A storage occupancy rate of 90%, up 6% compared to 2019, reflected strong storage demand from oil markets and robust storage demand in gas and chemical markets, it says.

As per MRC, SABIC and Vopak Holding Terminals BV have signed an agreement with the Jubail and Yanbu Industrial Cities Company (JYIC), owned by the Royal Commission for Jubail and Yanbu (RCJY). Under the agreement, JYIC will become a 20 percent stake partner in Jubail Chemical Storage and Services Company (Chemtank).

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.
Author:Anna Larionova
Tags:petroleum products, PP, PE, neftegaz, Sabic.
Category:General News
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