Dutch oil and chemical storage company Vopak on Friday said it would consider selling four European petroleum terminals, as increasing competition in fuel markets led to a stronger than expected drop in second-quarter profit.
Vopak's earnings before interest, taxes, depreciation and amortization (EBITDA) dropped 5 percent in the April-June period to 180.7 million euros ($205.6 million), as the occupancy rate of its terminals declined to 85 percent from 90 percent a year earlier.
Analysts in a Reuters poll on average predicted EBITDA would fall 2 percent to 188 million euros, with 87 percent of the terminals' total capacity used.
Occupancy mainly dropped at oil hub terminals and Vopak said it would take 6 to 12 months to see whether it could get a good price for its petroleum terminals in Algeciras, Amsterdam, Hamburg and Tallinn.
"We feel this is a good moment for this strategic review," Chief Financial Officer Gerard Paulides said in a telephone interview. "But if we don't get a good price, we will hold on to these assets."
Vopak said it would expand chemical and bunker fuel terminals in Antwerp, Rotterdam, Singapore and Indonesia, and increased its cost cutting target for 2019 by 15 million euros to 40 million euros. These savings should keep total costs at the level of 2017, despite the increased capacity.
"The expansion plans and cost cutting program give us confidence that we can achieve a significant EBITDA improvement next year," Paulides said.