Vopak lifts full-year targets again on strong tank storage demand (updated)

Koninklijke Vopak

Wed 06:20

Adds context in paragraph 2, CFO comments in paragraphs 3, 4, 8 and 11, share move in paragraph 7.
Vopak raises annual targets again after strong third quarter
Impact from Middle East disruption less severe than feared, CFO Gilsing says
Contract renewals and cost controls help lift outlook
By Hugo Lhomedet and Dimitri  Rhodes
Nov 4 (Reuters) - Dutch tank storage operator Vopak VOPA.AS raised its 2026 targets for the second time this year on Wednesday, citing robust demand for storage capacity and a less severe Iran war impact than initially feared.
The US-Israeli war with Iran has disrupted some energy flows through the Middle East, prompting importers and traders to seek alternative supply routes and additional storage capacity.
Finance chief Michiel Gilsing said the guidance hike was driven primarily by stronger performance at Vopak's existing terminals rather than new projects, as the company renewed contracts at attractive rates and kept a tight grip on costs.
"We see less of a risk at the lower end," Gilsing said.
Vopak now expects its proportional earnings before interest, taxes, depreciation and amortization to land between €1.20 billion and €1.22 billion ($1.35 billion and $1.37 billion) in 2026, lifting the bottom end of the previous range by €20 million.
It also raised its full-year proportional operating free cash flow outlook by 2.4% to €840 million.
The Amsterdam-listed shares rose as much as 6.3% to their highest price in nearly 14 years. They were trading 2.5% higher by 0903 GMT.
Gilsing said the Middle East conflict had affected Vopak less than initially feared, contributing to the higher outlook. The company operates terminals in the United Arab Emirates and Saudi Arabia, giving it exposure to trade flows through the Strait of Hormuz and the Bab al-Mandab Strait.
Quarterly net profit grew 61% to €141.7 million, helped by a €30 million gain related to changes in ownership stakes in its Saudi terminal operators Chemtank and Sabtank.
Proportional EBITDA rose 6.8% to €306.1 million, while the proportional occupancy rate, a key indicator of terminal demand, was 91%.
Gilsing said the REEF liquefied petroleum gas export terminal in Canada, which offers an alternative to some Middle Eastern supply flows, remained on track to start contributing to earnings in 2027.
($1 = 0.8905 euros)

(Reporting by Hugo Lhomedet and Dimitri Rhodes in Gdansk, editing by Milla Nissi-Prussak)
((hugo.lhomedet@thomsonreuters.com))