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Vopak Aims to Improve Performance

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Vopak has said it aims to improve the performance of the portfolio and is targeting an operating cash return of at least 10 percent by 2025.

By 2025, Vopak added that it expects that the share of proportional capital employed in industrial and gas will further increase, while the share of oil and chemical will gradually decline.

In response, Vopak will grow its base in industrial and gas terminals by allocating EUR 1 billion to these activities by 2030: “This will further support a long-term and steady cash flow generation. Vopak will continue to invest in the growing global gas markets and expand its network of LNG and LPG terminals at strategic locations. Vopak aims to further grow and maintain its position as market leader in industrial terminals.”

Vopak said in the update: “Vopak will accelerate its portfolio investments towards new energies and sustainable feedstocks by allocating €1 billion in growth capital to these activities by 2030. This will not only shape the future of Vopak, but also positively contribute to the transition within key industrial clusters and shaping of the energy hubs of the future.”

The share of zero-carbon and low-carbon energy and sustainable feedstocks at Vopak’s existing locations will be increased and new infrastructure for the introduction of the vital products of the future will be developed.

Here, Vopak said its focus is on infrastructure solutions for low-carbon and renewable hydrogen, ammonia, CO2, long duration energy storage and sustainable feedstocks. Those terminals within the Vopak network that store traditional fuels and feedstocks will be well positioned to handle low carbon substitutes.

Vopak said it aims to deliver strong cash flow generation and commits to a disciplined allocation of capital. Vopak targets a robust balance sheet with sufficient financial flexibility in the range of around 2.5 to 3.0 times senior net debt to EBITDA and may temporarily be outside this range depending on capital allocation choices.

It concluded: “Vopak will continue to manage the portfolio in line with its strategy and be a steward of shareholder value creation. To reflect its strong cash flow generation, Vopak will update its dividend policy to a progressive dividend policy aiming to maintain or grow our annual dividend, subject to market conditions.”

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