Royal Vopak NV · EURONEXT:VPK
Royal Vopak NV — Shareholder Meeting (April 2008)
74 slides from Royal Vopak NV's shareholder meeting presentation, Apr 24, 2008
Slide 1: Annual General Meeting 2008
Annual General Meeting 2008 24 April 2008 Professionals in liquid bulk logistics 1
Slide 2: Agenda
Agenda ▢ Achievements FY 2007 ▢ Achievements Q1 2008 ▢ Strategy ▢ Business performance FY 2007 ▢ Business performance Q1 2008 ▢ Outlook 2
Slide 3: 2007: A Year of Focus, Progress and Acceleration
2007 A Year of Focus, Progress and Acceleration Organic growth Strategic initiatives Growth projects Safety Rationalization of the business Organization Many plans in the pipeline Outlook 3
Slide 4: Process Safety & Quality Performance
Process Safety & Quality Performance LTIR Terminal Health Assessment 6 100% 5 80% 4 60% 3 40% 2 1 20% 0 0% 2002 2003 2004 2005 2006 2007 2004 2005 2006 2007 Spills 160 140 120 Increased management attention 100 80 60 40 20 0 2004 2005 2006 2007 4
Slide 5: 2007 EBIT Growth Mainly By Autonomous Growth
2007 EBIT Growth Mainly By Autonomous Growth EBIT Growth in 2007 Net Revenues 900 15% In mln EUR 800 700 85% 600 500 2003* 2004 2005 2006 2007 Autonomous growth New capacity growth Occupancy rates 100% 96% 92% 88% 84% 80% 2003* 2004 2005 2006 2007 * based on Dutch GAAP. Revenues in 2003 include tank
Slide 6: Growth By Expansions in 2007
Growth By Expansions in 2007 Once again, more gained from our existing network in 2007 Vlaardingen Zhangjiagang Lanshan Ulsan Sydney site B Banyan ACS Antwerp Darwin Europoort Botlek Altamira SABtank Thai Tank Savannah (Al Jubail) Ownership of the companies in Estonia and Vietnam was increased to 10
Slide 7: Rationalization
Rationalization Portfolio Business Rationalization Sale Hemiksem Sale Dordrecht Sale Westwego Westwego Hemiksem Dordrecht 7
Slide 8: Step Into The LNG Terminal Business - Fulfilled
Step Into The LNG Terminal Business - Fulfilled Operational in 2011 The launching customers: 8
Slide 9: Agenda
Agenda ▢ Achievements FY 2007 ▢ Achievements Q1 2008 ▢ Strategy ▢ Business performance FY 2007 ▢ Business performance Q1 2008 ▢ Outlook 9
Slide 10: Growth by expansions in Q1 2008
Growth by expansions in Q1 2008 Projects commissioned in Q1 2008: Fujairah oil 380,000 cbm Sebarok chemicals 125,000 cbm Zhangjiagang Europoort 12,500 cbm 200,000 cbm Other projects commissioned in Q1 2008: Korea, Mexico, Thailand, Venezuela, the UK (In total: 85,000 cbm) 10
Slide 11: New announced project in Q1 2008
New announced project in Q1 2008 Vopak Terminal Vlaardingen Expansion: 60,000 cbm Division: CEMEA 11
Slide 12: Current Growth Projects
Current Growth Projects London Amsterdam Teesside Europoort Rotterdam Gothenburg Biodiesel Tallinn LNG (R’dam) Zhangjiagang Spain Bahamas Pakistan Korea Botlek pit19 Houston Vlaardingen Antwerp Caojing Fujairah Altamira Thailand Suape Vietnam Banyan Venezuela Sebarok Penjuru San Venezuela Antonio Al
Slide 13: Many Projects In The Pipeline
Many Projects In The Pipeline Potential Projects Announced opportunities under study projects 13
Slide 14: Agenda
Agenda ▢ Achievements FY 2007 ▢ Achievements Q1 2008 ▢ Strategy ▢ Business performance FY 2007 ▢ Business performance Q1 2008 ▢ Outlook 14
Slide 15: Strategic Focus Vopak
Strategic Focus Vopak The execution of the strategy is on track Growth Leadership Customer Leadership Cost Efficient Operations Pursue and strengthen Attain service excellence leadership in key locations across the network Attain low cost position compared to key Invest in partnerships with Become p
Slide 16: Growth Leadership
Growth Customer Cost Efficient Leadership Leadership Operations Growth Leadership - investing in growth Excellence Leadership Enablers Design standards for new terminals Priority setting & focus Business development teams ? Capacity additions, in mln cbm ? Bahamas Bahamas Bahamas ? 26 ?? EOS ? 25 24
Slide 17: Focus On Clients
Growth Customer Cost Efficient Leadership Leadership Operations Focus On Clients - recognizable high-level Excellence services at every site Leadership Enablers Focus on key accounts Global service proposition Business intelligence network Customer Service Improvements 17
Slide 18: Efficiency Leadership
Growth Customer Cost Efficient Leadership Leadership Operations Efficiency Leadership - safe, sustainable and Excellence profitable Leadership Enablers Focus on safety performance Design standards for new terminals Process efficiency Standardization of service processes 18
Slide 19: Organization
Organization Professionalize organization and management Invest in people Performance management Recruitment and selection Management development programme Knowledge sharing within organization 19
Slide 20: Our Efforts Followed By Increasing Result
Our Efforts Followed By Increasing Result EBIT excl. exceptionals EBIT 2007: EUR 272.9 mln 300 290 280 270 260 250 240 230 220 210 2006 2007 Confident to reach our 2011 plan EBITDA EUR 475-550 mln one or two years earlier 20
Slide 21: Agenda
Agenda ▢ Achievements FY 2007 ▢ Achievements Q1 2008 ▢ Strategy ▢ Business performance FY 2007 ▢ Business performance Q1 2008 ▢ Outlook 21
Slide 22: Market Developments
Market Developments Oil: Chemicals: • Product differentiation • Increasing demand for storage • Increasing geographical imbalances • Robust growth in developing markets between demand and supply • Liberalization of new markets • Build-up of new petrochemical complexes in Asia and Middle East • High
Slide 23: Strategic Focus
Strategic Focus DONE IN PROGRESS TO BE EXPLORED 2003-2007 2008-2010 TANK TERMINAL Divestments non-core activities STRATEGY Expansions: Expansions: Sebarok, Europoort, Fujairah, Gothenburg, Banyan REVITALIZE OIL Estonia, Malmö, Al Greenfield: Jakarta GROWTH Jubail, Sydney STRATEGY Greenfields: Darwin
Slide 24: Divestments 2003-2007
Divestments 2003-2007 2003 Chemgas Shipping VO Clipper Shipholdings Dutch P&I Services & Dutch Shipping Defence Dockwise Transport 2004 Chemical Tankers Fluvia (Shipping Switzerland) and Warehousing 2005 Total Totalannual annual Vegoils Shipping (Germany and the Netherlands) revenues: revenues: Mine
Slide 25: Net Revenues / EBIT FY 2007
Net Revenues / EBIT FY 2007 | a enna age ; ; ce ae = www.vopak.com 25
Slide 26: Robust Financial Performance
Robust Financial Performance FY 2007: EBIT increased by 24% In EUR millions FY06 FY07 ∆% Net Revenues 778.1 853.0 10% EBIT 220.9 272.9 24% Net Profit* 122.2 163.5 34% EPS (EUR) 1.96 2.62 34% All figures are excluding exceptional items * attributable to holders of ordinary shares 26
Slide 27: EBIT incl. Exceptionals Increased By 35%
EBIT incl. Exceptionals Increased By 35% In EUR millions FY06 FY07 ∆% Net Revenues 778.1 853.0 10% EBIT 216.6 292.2 35% Net Profit* 129.4 181.1 40% EPS (EUR) 2.08 2.90 39% All figures are including exceptional items * attributable to holders of ordinary shares 27
Slide 28: Exceptional Items in 2007
Exceptional Items in 2007 In EUR millions Result of divestments 21.7 Other - 2.4 Exceptional items 19.3 28
Slide 29: FY 2007: EUR 52 mln increase in EBIT
FY 2007: EUR 52 mln increase in EBIT* OEMEA 79.7 North America 62.7 Asia 31.1 74.9 78.8 25.5 22% 27% 06 07 06 07 5% 06 07 CEMEA 89.3 Latin America 60.7 21.1 Other 19.9 -22.8 -27.1 6% 47% 19% 06 07 06 07 06 07 *excluding exceptional items 29
Slide 30: Net Profit
Net Profit . www.vopak.com 30
Slide 31: Net Profit FY 2007 Increased By 40%
Net Profit FY 2007 Increased By 40% In EUR millions FY06 FY07 ∆% Net Revenues 778.1 853.0 10% EBIT 216.6 292.2 35% Finance Income & Expenses -44.2 -42.9 3% Tax -25.5 -51.2 101% Minority Interests -15.0 -15.2 1% Net Profit* 129.4 181.1 40% EPS 2.08 2.90 39% All figures are including exceptional items
Slide 32: Net Financing Costs
Effective Access to Financing Sources Net Financing Costs In EUR millions FY06 FY07 Interest and dividend income 6.8 7.0 Financing costs -51.0 -49.9 Net financing costs -44.2 -42.9 32
Slide 33: Effective Tax Rate FY 2007
Effective Tax Rate FY 2007 Effective Tax Rate € In EUR millions FY07 FY07 % FY06 % Tax -51.2 20.5% 20.8%* Effective Tax Rate -51.2 20.5% 14.8%** * excl. exceptional movements in prior-year taxes ** incl. exceptional movements in prior-year taxes Changes in tax rates: Tax rates 2006 2007 As of 2008 S
Slide 34: Currency Translation Sensitivity
Currency Translation Sensitivity EUR/USD Impact of a +/-10 dollar cent movement: • Turnover EUR -/+11.4M • EBIT EUR -/+3.5M • Net Result EUR -/+2.2M EUR/SGD Impact of a +/-10 dollar cent movement: • Turnover EUR -/+4.8M • EBIT EUR -/+2.2M • Net Result EUR -/+1.5M 34
Slide 35: 5 Years Vopak
5 Years Vopak | www.vopak.com 35
Slide 36: Robust Performance: 2003-2007
Robust Performance: 2003-2007 In EUR millions Net Revenues Occupancy rates 900 100% 850 96% 800 92% 750 88% 700 84% 650 600 80% 2003* 2004 2005 2006 2007 2003* 2004 2005 2006 2007 EBIT excl. exceptionals ROCE 300 30 250 25 200 20 150 15 10 100 2003* 2004 2005 2006 2007 2003* 2004 2005 2006 2007 Net
Slide 37: Revenues 2003 vs 2007
Revenues 2003 vs 2007 In EUR millions 900,0 41% 800,0 700,0 853.0 600,0 500,0 749.6 400,0 300,0 200,0 100,0 0,0 Revenues 2003 Divestments New capacity & Revenues 2007 improved margins Revenues 2003 are based on Dutch GAAP 37
Slide 38: EBIT excl. Exceptionals 2003 vs 2007
EBIT excl. Exceptionals 2003 vs 2007 In EUR millions 300,0 96% 250,0 200,0 272.9 150,0 100,0 148.3 50,0 0,0 EBIT 2003 Divestments New capacity & EBIT 2007 improved margins EBIT 2003 are based on Dutch GAAP 38
Slide 39: Debt development
Debt development Debt 1000 800 600 400 200 0 2002* 2003* 2004 2005 2006 2007 Average Interest Rate 8,0% 7,5% 7,0% 6,5% 6,0% 2002* 2003* 2004 2005 2006 2007 * based on Dutch GAAP 39
Slide 40: Pension
Pension Pension obligations VS Plan assets 1000 800 600 400 200 0 2003 2004 2005 2006 2007 ASSUMPTIONS 2003 2004 2005 2006 2007 Discount rate 5.52% 4.58% 4.11% 4.58% 5.54% Expected return plan assets 6.52% 5.41% 5.04% 5.67% 5.88% 40
Slide 41: Sources and Uses of Cash
Sources and Uses of Cash | www.vopak.com 41
Slide 42: Sources and Uses of Cash
Sources and Uses of Cash FY06 FY07 Net Cash Flow -64.8 25.5 EUR (mln) 305.2 -370.0 686.1 -660.6 800 700 Dividends 600 Proceeds from Proceeds from 500 interest-bearing interest-bearing 400 loans loans Dividends Investments 300 Divestments Divestments 200 Investments 100 Operations Financing Operation
Slide 43: Operational Net Cash Flow
Cash Source Operational Net Cash Flow FY 2007: increased by 17% Operations Sources Uses EUR (mln) 300 250 263.2 200 150 225.3 100 50 0 17% 2006 2007 43
Slide 44: Investments
Cash Use Investments* Investments FY 2007: increased by 67% Sources Uses EUR (mln) 500 400 300 445.7 200 267.6 100 0 67% 2006 2007 * including Maintenance and SHE CAPEX 44
Slide 45: Dividends
Cash Use Dividends Dividends Sources Uses Proposed dividend in 2007 amounts to EUR 0.95 per ordinary share Proposed dividend 1 0,8 0,6 0.95 0.75 0,4 0.60 0.50 0.50 0,2 0 2003 * 2004 * 2005 2006 2007 * optional in cash or ordinary shares 45
Slide 46: Dividend Payment
Dividend Payment NYSE Euronext Rule: Cum date Cum date Cum date + 1 business + 3 business + 4 business day days days ‘Cum’ date ‘Ex’ date Record date First possible payment date 25-04-08 28-04-08 30-04-08 2-05-08 Entitled to Not entitled Determining Dividend dividends to dividends account holders pa
Slide 47: Total investments
Total investments | www.vopak.com 47
Slide 48: Total Investments 2003-2007
Total Investments 2003-2007 446 268 188 146 151 2003* 2004 2005 2006 2007 * based on Dutch GAAP 48
Slide 49: Investing In Growth
Investing In Growth 2008 and onwards Group companies and Around joint ventures € 450M € 1.6B Total investments to be spent from 2008+ Vopak share 2008+ Approved & Under Construction Projects Approved & Under Construction Projects Yearly Sustaining Capex +/- € 100M 49
Slide 50: Expansion in progress: Teesside Terminal
Expansion in progress Teesside Terminal Division: CEMEA Start of operations: Q3/Q4 2008 Capacity: expansion 40,000 cbm Product focus: ethanol Vopak Teesside Terminal 50
Slide 51: Expansion in progress: Zhangjiagang Terminal
Expansion in progress Zhangjiagang Terminal Division: Asia Start of operations: Q2/Q3 2008 Capacity: expansion 72,000 cbm Product focus: chemicals Vopak China – Zhangjiagang Terminal 51
Slide 52: Expansion in progress: Banyan Terminal
Expansion in progress Banyan Terminal 371,800 cbm 165,000 cbm 320,000 cbm 397,500 cbm 1.25 M 2006 2007 2008 2009 52
Slide 53: Vopak Jakarta Terminal
Vopak Jakarta Terminal Jetty Undersea pipelines Tankfarm Division: Asia Start of operations: Q4 2009 Capacity: 250,000 cbm Product focus: oil ‘Artist impression of Vopak Jakarta Terminal’ 53
Slide 54: New terminal – under construction: Gate Terminal
New terminal – under construction Gate Terminal Division: LNG Start of operations: 2H 2011 Capacity: 540,000 cbm Product focus: LNG ‘Artist impression of Gate Terminal’ 54
Slide 55: Strategic Finance
Strategic Finance | www.vopak.com 55
Slide 56: Strategic Finance: Sufficient Flexibility
Strategic Finance: Sufficient Flexibility Net debt : EBITDA ratio 2007 1.71 2006 1.61 2005 1.76 2004 2.20 2003* 2.42 2002* 2.49 ׀ 0 0.5 1 1.5 2 2.5 3 3.5 3.75 4 Maximum Ratio under US PP Maximum Ratio under other loans and syndicated revolving credit facility * based on Dutch GAAP 56
Slide 57: Strategic Finance: Solid Equity Position
Strategic Finance: Solid Equity Position Shareholders’ equity EUR (mln) Net Debt 900 810 785 800 671 700 619 604 625 600 521 500 509 504 496 472 500 400 300 200 2002* 2003* 2004** 2005 2006 2007 * based on Dutch GAAP 57 ** Restructuring preference shares: -50.3 and IFRS adjustment: -44.7
Slide 58: Overview of US PP terms and RCF
Overview of US PP terms and RCF Covenant/ Term US PP 2001 US PP 2007 New RCF Maximum Net 3.75 3.75 3.75 Debt / EBITDA Additional headroom Up to 4.25 > 3.75 When financed with subordinated debt EBITDA / Net Interest > 4.0 > 3.5 > 3.5 Payable Amount USD USD EUR 396 mln 375 mln 1 bln + EUR 200 mln 58
Slide 59: Other projects: Accounting/Financial reporting implications
Other projects: Accounting/Financial reporting implications 59
Slide 60: Gate Terminal – impact on Vopak Financial Statement
Gate Terminal – impact on Vopak Financial Statement Equity: 42.5% Capacity: 0.5M cbm Project Phase Operations 2007-2011 beyond 2011 Joint ventures Joint Jointventures ventures Balance sheet and associates and associates and associates Result of jv based Profit & Loss Only pre-OPEX on equity method E
Slide 61: Vopak Terminal Bahamas – impact on Financial Statement
Vopak Terminal Bahamas – impact on Vopak Financial Statement Equity: 20% Capacity: 3M cbm Joint ventures Balance sheet and associates Result of jv Profit & Loss (equity method) + Management fee Acquisition price Cash Flow* Dividend * First 5 years no dividend expected. Operational free cash flow wil
Slide 62: Pakterminal – impact on Vopak Financial Statement
Pakterminal – impact on Vopak Financial Statement Capacity: 0.4M cbm Before 50% Pakterminal transaction date EOS Pakterminal EOS (50%) (100%) (Share) Joint ventures Joint ventures Balance sheet 100% consolidated and associates and associates Result of jv Result of jv Profit & Loss 100% consolidated
Slide 63: Barging – impact on Vopak Financial Statement
Barging – impact on Vopak Financial Statement Before After transaction date transaction date (100%) (50%) Joint Jointventures ventures Balance sheet 100% consolidated and associates and associates Result of jv Profit & Loss 100% consolidated (equity method) Result of Sale Cash Flow 100% consolidated
Slide 64: SUMMARY: 2007 Another Strong Year for Vopak
SUMMARY: 2007 Another Strong Year for Vopak Revenues in billion EUR; all figures are excl. exceptional items and incl. joint ventures Revenues EBITDA margin EBIT margin ROCE 6 50% 45% 5 40% 35% 4 30% 3 25% 20% 2 15% 10% 1 5% 0 0% 1999 2000 2001 2002 2003 2004 2005 2006 2007 64
Slide 65: Agenda
Agenda ▢ Achievements FY 2007 ▢ Achievements Q1 2008 ▢ Strategy ▢ Business performance FY 2007 ▢ Business performance Q1 2008 ▢ Outlook 65
Slide 66: Robust Financial Performance
Robust Financial Performance Q1 2008: EBIT excl. exceptional items increased by 17% In EUR millions Q1 07 Q1 08 ∆% EBIT 69.0 79.2 15% EBIT excl. exceptional items 67.6 79.2 17% There were no exceptional items in Q1 2008 66
Slide 67: Q1 2008: 17% increase in EBIT excluding exceptional items
Q1 2008: 17% increase in EBIT excluding exceptional items OEMEA North America 26.0 21.9 Asia 7.2 7.5 23.4 19.2 4% 19% Q1-07 Q1-08 Q1-07 Q1-08 22% CEMEA Q1-07 Q1-08 Latin America 23.1 20.3 Other 5.1 5.3 -6.1 -6.1 4% 14% Q1-07 Q1-08 Q1-07 Q1-08 Q1-07 Q1-08 67
Slide 68: Strong demand for storage capacity
Strong demand for storage capacity Occupancy rate Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 97% 96% 96% 96% 96% Capacity (in cbm, at the end of each quarter) 21,351,500 21,460,000 21,464,240 21,834,200 22,619,200 EBIT excl. exceptional items (EUR mln) 67.6 71.8 68.6 64.9 79.2 68
Slide 69: Focus on growth
Focus on growth Capacity will be increased by more than 2.7M cbm by the end of 2009 2007 Capacity 21,834,200 cbm Total net capacity increase in 785,000 cbm Q1 2008 Total YTD Capacity 22,619,200 cbm 2008 & 2009 (2.7M - 785K) +/- 1.9M cbm Gate (2011) 0.5M cbm Bahamas (In progress) 3.0M cbm Total >28.0
Slide 70: Agenda
Agenda ▢ Achievements FY 2007 ▢ Achievements Q1 2008 ▢ Strategy ▢ Business performance FY 2007 ▢ Business performance Q1 2008 ▢ Outlook 70
Slide 71: Outlook EBIT 2008
Outlook EBIT 2008 March 7, 2008 Vopak expects Group operating profit excluding exceptional items to increase around 10% in 2008 (2007: EUR 272.9 million). As a consequence of the commissioning of the current expansion projects in the coming years, Vopak expects to achieve the lower end of its long-
Slide 72: Outlook Summary
Outlook Summary Guidance Outlook 5 year plan EUR (mln) FY 2006 FY 2007 FY 2008 (2011) Long-term EBITDA* 309.8 388.8 475-550 Updated to EBIT** 220.9 272.9 a minimum 2009 / 2010 increase of 10% ROCE 19.4% 25.1% Around 16% Bearing Bearingininmind mind substantial investments substantial investments ini
Slide 73: Forward-looking statement
Forward-looking statement 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 accura
Slide 74: Thank you for your attention!
Thank you for your attention! 74