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planned for the Sydney terminal in Australia, with completion also scheduled for second quarter 2021.

MARKET ENVIRONMENT Vopak’s commercial and financial performance is dependent to a large extent on global economic and market developments. In its half-year report, the company notes that geopolitical tensions are now “impacting business optimism”, although it says that the service sector has been resilient and consumer spending is still solid.

Furthermore, cheap shale-based ethane feedstocks are prompting further investment in petrochemical facilities in the US and, although economic activity is “gradually decelerating” in Asia, it remains robust, with China, India and Vietnam still managing to generate annual growth of 6 to 7 per cent. Trade tensions and lower chemical prices have led to changes in trade flows, which has had a positive impact of Vopak’s chemical hub in Singapore.

In the oil market, trade tensions and sanctions have affected the supply side but Vopak’s main fear is that geopolitical factors could impact economic growth and further slow growth in oil demand, which has already been affected by environmental considerations. On the other hand, the biofuels and vegoils markets continue to be strong in many areas of the world.

The opening of the Ridley Island LPG export terminal in British Columbia, Canada earlier this year signals Vopak’s interest in the LPG sector and the company notes that global LPG supply is continuing to grow; US exports were 20 per cent higher in the first half of 2019 compared to the same period last year, despite China’s imposition of a 25 per cent tariff on US LPG in August 2018. US product is moving to other markets, including India, while China is sourcing more product from the Middle East. REGION BY REGION Those market factors have been reflected in the first-half results for Vopak’s various divisions. In Europe and Africa, for instance, revenues were down 2 per cent year-onyear, although Vopak says this was largely due to “relatively high out of service capacity” in its Rotterdam terminals as they prepare for the IMO 2020 changes. Vopak notes that the economic outlook for the Eurozone area remains weak as a result of adverse dynamics, ongoing uncertainty over Brexit, and weaker demand from the automotive sector.

Revenues from the Asia and Middle East division rose by 3 per cent against first-half 2018, with group EBITDA up 17 per cent. Vopak enjoyed higher revenues from its chemical terminals, although this was partly offset by work at its Singapore sites to ready them for IMO 2020.

The Americas division posted a 9 per cent increase in revenues and a 19 per cent rise in EBITDA, although this was partly accounted for by currency movements. Much of the rest of the gain reflected additional capacity commissioned in Houston, although there were difficulties here during the period as a result of the fire at ITC’s nearby Deer Park terminal in March.

The small China and North Asia division recorded a 19 per cent increase in revenues and a 40 per cent rise in EBITDA compared to first half 2018. Much of the improvement was due to the acquisition of the Ningbo terminal in early 2019 and the restarting of the Heiteng industrial terminal in June 2018.

Vopak’s activities in LNG grew by 7 per cent over first-half 2018, largely as a result of its investment in the Engro Elengy Terminal in Pakistan in December 2018. This division is, though, an important part of Vopak’s strategy going forward, as Hoekstra explains: “Looking further ahead, we continue to explore opportunities in new energies.”

In addition, Vopak’s digital transformation is “progressing well”. A cloud-based digital terminal management system is being rolled out at terminals around the world. HCB www.vopak.com

VOPAK IS CONCENTRATING ITS INVESTMENTS IN GROWTH

MARKETS AND IN EMERGING ENERGY FLOWS, INCLUDING

LPG AND LNG, WHILE DISPOSING OF SOME OF ITS OLDER