August 01, 2020 [Hellenic Shipping News] – EBITDA of EUR 403 million (HY1 2019: EUR 423 million pre-divestments). Adjusted for EUR 3 million negative currency translation effects and the impact of the divestments of the terminals in Algeciras, Amsterdam and Hamburg (EUR 35 million decrease), EBITDA increased by EUR 18 million (4%), reflecting resilient business performance including the effect of contango oil markets, IMO 2020 converted capacity and reduced chemicals throughput.
Occupancy rate subsidiaries of 86% (HY1 2019: 85%) reflects support from contango developments in the oil markets in Q2, whereas storage demand in other market segments remained robust. Planned inspection and maintenance out-of-service capacity at subsidiaries was 1.4 million cbm in Q2 2020.
Proportional occupancy rate of 88% (HY1 2019: 84%) included good performance of joint venture oil terminals and continued strong performance of our joint venture gas and industrial terminals.
In response to COVID-19 conditions, cost control measures were implemented to manage and reduce Vopak’s cost base; the cost level for HY1 2020 amounted to EUR 295 million and as a result we now aim to be at some EUR 600 million for the year.
EBIT of EUR 257 million (HY1 2019: EUR 274 million pre-divestments).
Return on capital employed (ROCE) of 11.8% (HY1 2019: 12.6%).
Net profit attributable to holders of ordinary shares of EUR 166 million (HY1 2019: EUR 173 million) resulting in earnings per ordinary share (EPS) of EUR 1.31 (HY1 2019: EUR 1.35).
Vopak’s balance sheet is robust with a senior net debt to EBITDA ratio of 2.81 at the end of HY1 2020. The balance sheet flexibility was further strengthened with the successful completion of the USD 350 million and EUR 150 million US Private Placement Notes Program in July 2020.
Share buyback program to return EUR 100 million to shareholders is progressing with 55% completed at the end of HY1 2020.
First half year portfolio developments were the delivery of 275,000 cbm of new capacity from growth projects in Malaysia, Panama and Vietnam and the completion of the divestment of the terminal in Algeciras, Spain.
Impact of COVID-19 pandemic:
The pandemic spread of COVID-19 (Coronavirus) has a significant impact on all people and organizations around the world. Our main focus is on the health of the people working for our company in all locations and to limit the spread of the Coronavirus, to manage the impact on our business and to assess the impact on the economy and society. Therefore we have put global and local measures into place to protect our employees, their families and our operations based on information provided by the World Health Organization, national and local health authorities. To date, we have observed a limited impact on our operations. All our 66 terminals are operational and there have been no significant disruptions to business continuity.
Vopak’s strategy is robust and unchanged. An effective control and governance structure to respond to the impact of the global pandemic, with continued decision-making to support business execution and well-being of people, has been put in place. Operational and financial performance, cash flows and our financial position have not been significantly affected. Our financial results reflect our resilient business performance. Timing of some growth projects execution is affected by generic local lockdown measures in various countries.
Our focus in these circumstances is on the short-term delivery and protection of long-term value. Vopak plays an important role within society by storing vital products with care. We are doing our utmost during the COVID-19 pandemic to continue to fulfill this role in all our locations around the world.
Although the pandemic brings a lot of uncertainty and the estimates remain subject to future events, we expect to continue to manage our performance in line with our original business plan and unchanged strategy.
Exceptional items HY1 2020:
On 31 January 2020, Vopak completed the earlier announced divestment of its 100% shareholding in the terminal in Algeciras, Spain, generating a cash inflow of EUR 135 million. The recognized exceptional loss before taxation was EUR 1.7 million. This completed the divestment program of the terminals in Algeciras, Amsterdam and Hamburg with a total exceptional gain of EUR 200 million recognized in the periods 2019 and Q1 2020.
In Q2 2020, Vopak recognized a EUR 33 million exceptional gain for the remaining consideration relating to the December 2019 divestment of its 49% equity share in the joint venture Vopak SDIC Yangpu Terminal in Hainan, China. Of this amount, EUR 16.3 million is expected to be received in the second half of 2020.
On 22 July 2020, Vopak announced to have signed agreements for a new debt issuance of over USD 500 million equivalent in the US Private Placement (USPP) market consisting of senior tranches with a total value of USD 150 million and EUR 150 million and subordinated tranches with a total value of USD 200 million.
In July 2020, Vopak Terminals Singapore completed its refinancing by entering into a new financing of SGD 300 million (approximately EUR 190 million), consisting of a term loan and a revolving credit facility.
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