Koninklijke Vopak Uns/Adr

Hello and welcome to the Quarter 1, 2023 Interim Update Conference Call. My name is Priscilla and I'll be your coordinator for today's event. Please note this call is being recorded and your lines will be on listen only. If you require assistance at any point, please press star zero and you'll be connected to an operator. I will now hand you over to your host, Factrona, to begin today's conference. Please go ahead.

Hi, hello everyone, and welcome to our first quarter 2023 READ results. My name is Tatyana Topcu, Head of IR. Our CEO, Siddique Rees-Brichel, and CFO, Mihail Hilsing, will guide you through our latest results. We will refer to the Q1 2023 analyst presentation, which you can follow on screen and download from our website. After the presentation, we will have the opportunity for the Q&A. A replay of the webcast will be made available on our website as well. Before we start, I would like to refer you to the disclaimer content of the forward-looking statement, which you are familiar with. I would like to remind you that we may make forward-looking statements during the presentation, which involve certain risks and asserts on this. Accordingly, this is applicable to the entire call, including the answers provided during the Q&A part. With that, I would like to turn the call over to Dick.

Thank you very much, Facona, and a very good morning to all of you joining us in the call this morning. Let's go to the first slide, and the first quarter of this year shows strong performance. The need for our services was healthy across the different products and regions, and we continued to serve our customers well. We continue to deliver on our strategy to improve our financial and sustainability performance, to grow our base in industrial and gas terminals, and to accelerate towards new energies and sustainable feedstocks. We reported improved financial results. with an EBITDA of €249 million, which is a 70% increase compared to the same quarter last year. Besides financial improvements, I want to emphasize the focus on improving our sustainability performance, and we continued the trend of reducing our CO2 emissions in the first quarter. Looking ahead, I'm pleased to increase our 2023 outlook to above €950 million for EBITDA and above 12% operating cash return supported by favorable storage demand and cost management. Also, we improved our financial headroom and issued new debt as announced this week. This positions as well for future growth. Talking about growth, we signed an agreement with AltaGas for a 50-50 joint venture to develop a large-scale LPG export facility in West Canada, close to our RIPIT facility. In India, we announced to proceed with four expansion projects together with our joint venture partner, Aegis, in existing locations, strengthening our leading position in this fast-developing country. And recently, we updated you on our LEG projects in the Netherlands to further enhance the energy security and supply of Northwest Europe. To continue with our strategic goal of accelerating towards new energies and sustainable feedstocks, we are progressing well towards closing the acquisition of the prime location in the port of Antwerp. At this site, we will develop projects for new energies and sustainable feedstocks at the heart of a leading industrial cluster. We invested in the first quarter in a joint venture with Hydrogenius to further develop a hydrogen supply chain in Europe. Moving to share some of the key market dynamics and how they impacted demand for our infrastructure. I'd like to give you some details on how the markets in which we operate developed and their impact on VOPAC. Starting with gas, demand for LNG infrastructure remains in high demand for VOPAC, We see our gate terminal operating well in a normalized market. The other terminals in Mexico, Colombia, and Pakistan show a stable performance as per their role in their local energy systems. The momentum for hydrogen and ammonia continues to accelerate, which is also driven by governmental policies. We see an increasing interest in infrastructure to store and handle ammonia in different regions. The trend of a growing demand of sustainable fuels also continues to be there. And we are progressing well on our projects in Vlaardingen and Los Angeles to commission capacity for sustainable fuels and feedstocks. Moving on to the energy markets, which we serve through oil products. The oil flows are still rebalancing, following the international sanctions regime. This leads to changing flows, being more long-haul, generally spoken. A growing demand at one side versus production cuts announced by OPEC Plus are causing volatility in the market. These market dynamics cause favorable demand for our storage services. Oil distribution terminals serving local growing markets have a stable performance. Now let's take a look at the manufacturing markets where we serve through our industrial terminals and chemical terminals. The global manufacturing market sees margins under pressure due to oversupply and higher production costs. The US and Middle East are most competitive to produce petrochemicals, while Europe and Asia are facing challenges. Higher import volumes to make up for less local production are causing favorable demand for our infrastructure services. How this will develop in the remainder of the year needs to be seen. Our well-diversified portfolio leads to overall stable demand for chemical storage. Let's continue to the next slide. Let me take you through the different elements of our business performance in more detail. The starting point is last year's Q1 EBITDA of 213 million euros. Divestments we did last year had an impact of 2 million euros on the EBITDA when we compare it to this year. On the other hand, we experienced some positive currency translation effects of 4 million euros. The oil markets have been favorable since the second half of last year and showed steady improvements in the first quarter of this year. High occupant rates and contract renewals drive growth in EBITDA from our oil portfolio. With regards to the chemical markets, we have overall stable demand across the portfolio. Indexation of contracts is partially compensating the rising cost that has helped the revenue increase. The energy market is back to a normalized level as the available capacity is meeting the market demand with no need for additional sent out capacity. When comparing our cost base to Q1 of last year, we see an increase of 16 million, and that's mainly driven by inflation and higher energy and personnel costs. Finally, we've delivered on our growth projects, which have contributed 5 million euro in the first quarter. Moving on with gas. In West Canada, we formed a 50-50 joint venture with Altagas for a large-scale LPG and bulk liquids export facility. Next to our current facility, Ripet, a 77-hectare greenfield site with existing rail track will be further developed, including a new jetty. This location, which stays ice-free year-round, has significant logistical advantages towards Asia. From West Canada, it's only 10 to 11 days sailing to Asia, compared to 25 plus days from the U.S. Gulf Coast, and more than 18 days from the Arabian Gulf. As has been demonstrated by RIPIT, this makes it a strategic, attractive location. For the first phase of the terminal, which consists of approximately 98,000 cubic meters, we have signed a long-term commercial agreement with AltaGas. The location, as said, is strategically located and well connected to rail, and the new jetty will offer the capability to handle the largest gas-carrying vessels. The key permits to start construction are approved by both the federal and provincial governments. Beyond the first phase, this site offers a lot of opportunity to further develop for other bulk liquids like, for example, methanol. Our goal is to create, together with Helter Gas, high quality critical infrastructure for vital products, which fits well in our growth strategy. Also in India, we will expand. Together with our partner Aegis, we have a leading position in India as an independent storage provider. We operate 11 terminals across the country with a total capacity of just above 1.3 million cubic meters. These terminals mainly fulfill a distribution function in LPG, chemicals, oils and vegetables in this fast-growing economy. We announced and closed the joint venture with Aegis last year, and are pleased to present today four growth projects in three of these existing locations. We will add approximately 349 cubic meters of additional storage capacity, mainly for LPG, and to a lesser extent, also extra storage facilities for liquid products, such as vegetables, will be developed. will be approximately 95 million euros, and the capacity is expected to be commissioned by 2025. With this expansion, we strengthen our leading position in India and deliver on our strategic ambition to grow our base in gas terminals. In line with our market update two weeks ago on our LNG project portfolio, we see opportunities to grow our LNG footprint. We have the intention to acquire 50% of the shares of Ames Energy Terminal in the north of the Netherlands. The terminal is already operational and will contribute to our financial results upon completion of the deal expected by October this year. At Gate Terminal, we successfully closed the open season for a fourth LNG tank, which is expected to grow the recast capacity by 25%. A final investment decision is expected by September this year. GATE, as well as Ames Energy Terminal, fulfill an important role in the energy security of Northwest Europe. Both terminals are strategically located and offer opportunities to further develop for new energies. In Hong Kong, due to delays partially resulting in decreased attractiveness, we decided not to proceed with the project. All in all, our energy footprint continues to grow and offers opportunities to accelerate towards new energies. With regards to our strategic ambition to invest $1 billion to accelerate in new energies and sustainable feedstocks towards 2030, we see the momentum continuing. and that mainly centers around the infrastructure required for energy products of the future. You will see it active in four main areas, hydrogen and its carriers, low-carbon fuels and feedstocks, CO2 infrastructure, and long-duration energy storage. Hydrogen, and more specifically ammonia and LOHC, offer opportunities for VOPAG. We have a healthy pipeline of ammonia projects in the different regions, driven by an increasing demand for infrastructure to store and handle ammonia in a safe way, which is something we already have experience with, by storing and handling ammonia in six locations around the globe. The ACE terminal here in Rotterdam is a good example of a greenfield project to develop infrastructure for the storage and handling of green ammonia as a hydrogen carrier. Also with regards to LOHC, we have a joint venture with Hydrogenius, to further develop the supply chain of hydrogen between Germany and the Netherlands. With regards to low carbon fuels and feedstocks, we will soon commission a project in Vlaardingen to store waste-based feedstocks. I'm happy to see the progress on this strategic ambition to accelerate towards new energies and feedstocks. To summarize, we started the year with improved results and good progress on our strategic goals. The need for our services was healthy across all divisions and along all lines of products we store and handle. We benefited from VOPAC's well-diversified infrastructure portfolio, serving both the manufacturing markets as well as the energy markets around the globe. We improved our financial performance with strong Q1 results and continued our efforts in further reducing our CO2 emissions. We made good progress in growing our base in industrial and mainly gas terminals in the Netherlands for LNG and in Canada and India for LPG. A healthy interest is seen in infrastructure for new energies and sustainable feedstocks in mainly ammonia. Both our financial performance and favorable storage demand are driving the increased full year, the increased outlook for the full year of 2023. With that, I want to hand it over to our CFO, Michiel Helsing.

Thank you, Dick, and good morning to everyone in the call from my side as well. As Dick said already, from a financial point of view, we had a strong start of the year and all the divisions have contributed to the improved financial performance. We continue to deliver on our ambition to improve the performance of our portfolio. First of all, we increased our revenues to 362 million euros, a 12% increase compared to the first quarter last year, underpinned by occupancy rate of 92%, an increase of two percentage points compared to the fourth quarter of 2022. Secondly, also the EBITDA increased to 249 million euros, a 17% increase compared to the same period last year, supported by the favorable storage demand and partially offset by increasing costs compared to the first quarter of last year. Thirdly, the strong cash flow generation led to an operating cash return of 15.4% ahead of last year's 11.7%. Excluding the lesser accounting of 0.6 percentage points, the increase in operating cash return was 3.1 percentage points. We continue to invest in growth by allocating €54 million in growth projects during the first quarter, and the financial performance was underpinned by a solid balance sheet. Our senior net debt to EBITDA was 2.49 times at the lower end of our target of 2.5 to 3 times senior net debt to EBITDA. The improved performance of the portfolio was driven by organic growth across all the divisions. Favorable storage demand that have led to higher occupancy and better commercial terms in Asia and Middle East and in Europe and Africa have been the key drivers for EBITDA improvements. The strong performance in Asia and Middle East was driven mainly by the strong performance in Singapore, while the Netherlands terminals were the main drivers in Europe and Africa. Our terminal in Pengerang, PT2SB, in which Vopak owns 25%, is ready to be operational once the rapid refinery resumes operations, most likely mid of this year. Discussions are continuing with our customer on the outstanding receivable balance for contractually delivered services. The Americas and China division also had a steady performance. And the results of new energy and LNG division were in line with last year as the LNG market is getting back to normal levels after the disruption of the Russia-Ukraine war. The available capacity in the LNG market is meeting the demand with no need for additional send-out capacity. Then moving on to the well-diversified infrastructure portfolio. First of all, the Americas division continued its good performance with increased EBITDA quarter on quarter. For the Asia and Middle East division, occupancy rate reflected improved performance in Singapore and Fujairah in the Middle East as we continue to capture market opportunities there. The China and North Asia division performance remained solid and shows some improvement since China is now fully opened again after the closing of the COVID situation. Performance of Europe and Africa reflected the improved market conditions in Europe combined with a high occupancy of 90%. And regarding New Energy and LNG, the performance of the New Energy and LNG division remained solid at 100% occupancy rate, and the EBITDA was 11 million euros in the normalized LNG market compared to the second half of 2022. Then moving on to the cash flow generation. Our cash flow generation continued to be strong in the beginning of the year, driven by the positive business performance. Some working capital movement and derivatives, which were offset by lower dividend received from joint ventures. Our operating capex was 50 million, reflecting the timing of the low operating capex spent normally at the beginning of the year. Growth investments include growth projects in Vlaardingen, the Netherlands, and Alamoa in Brazil, as well as the transformation of the Eurotank terminal in Belgium. On our capital allocation, the deployment of growth CapEx towards our strategic priorities is going well. Since June 2022, when we announced the new strategy framework, we have allocated €269 million to grow our footprint in gas and industrial terminals. The investment in LNG that we announced a few weeks ago is not included in this number. Upon successful FID of gate 4 tank and the closing of the Ames Energy terminal investment, the investment amount will go to approximately 40% of our ambition to invest €1 billion in gas and industrial terminals. The investment on our joint venture, the 50-50 joint venture with Altagas in the West of Canada, will also be added once the final investment decision is being made. Accelerating towards new energies and sustainable feedstocks is progressing well and in line with our expectations. We are confident in our project funnel in new energies and foresee that the material capital allocation will be after 2025, as we already indicated when the framework was presented initially. Moving on to the balance sheet, we have a solid balance sheet that is supporting our growth ambitions. Our management philosophy is to keep our senior net debt to EBITDA in the low end of the range of 2.5 to 3 times EBITDA. We started the year at a leverage ratio of 2.49, an improvement compared to last year's first quarter leverage of 2.7, driven by better cash flow generation of the business. We will continue to manage the leverage ratio by focusing on increasing EBITDA, free cash flow, and improving dividend upstreaming from our joint ventures. We recently signed an agreement for a new debt issuance for a total amount of 400 million euro equivalent, with maturities ranging from five to 10 years. The program will further align the well-spread debt maturity profile of VOPAC's outstanding debt and will provide maximum flexibility under the current 1 billion euro revolving credit facility. We also reached an agreement to amend all existing private placement note programs, resulting in an increase of our senior net debt to EBITDA covenant from 375 to four times EBITDA. In our Pengerang terminal in Malaysia, PITSB, we have successfully refinanced the maturing project financing. The new facility is sustainability linked and approximately €270 million. The refinancing offers better financing terms and conditions and following the successful refinancing, Volpac will receive a dividend amount of approximately €60 million in 2023 and our guarantee towards PITSB will be released. So the financing will be completely non-recourse. Moving on to the disciplined capital allocation priorities, we're going to stay focused on a disciplined capital allocation approach that will support and enable the strategic priorities. And we have already showed good progress on it. First of all, we remain focused on a very solid balance sheet maintaining our healthy leverage ratio because that provides us with the license to invest for growth opportunities. Secondly, we will return value to shareholders by a progressive dividend policy. And lastly, any remaining capital will be spent on growth investments with attractive operating cash returns. Our focus on cash flow generation is further supporting the robust balance sheet and is providing available capital for growth investments. Then moving on to the outlook and outlook drivers. To summarize the key driving factors for our improved performance and increased outlook are first of all the market indicators. We are more positive than a few months ago on storage demand and we expect to remain favorable for the remainder of the year. The business performance, we see momentum in improved financial performance leading to an EBITDA increase by 70% year-on-year and operating cash return by 3.7% year-on-year. However, costs remain an area of attention for us. In Q1 2023, energy costs were more stable and lower compared to the second half of 2022. But for the remainder of 2023, we expect still some volatility in energy prices We're still in an environment with relatively high inflation and some pressure on the labor cost. Finally, we are confident that we can keep capturing growth opportunities and accelerate the company to the company we would like to be in the future. To bring it all together, here is a view of our short-term and mid-term increased financial outlook. On the short-term outlook, the EBITDA outlook for 2023 full year is expected to be above €950 million, an increase from the prior range of €910 to €950 million. The consolidated operating CAPEX outlook for the full year 2023 and consolidated growth investment outlook for the same year remained unchanged. Our proportional operating cash return is expected to be above 12% by the year end 23 and increased from our previous outlook, which was around 12%. On the long-term outlook, we're pleased that our strong business performance and focus on cash generation has made it possible to reach the 2025 target of operating cash return above 12% earlier than expected. Going forward, we aim to maintain an operating cash return of above 12%, which we believe is a healthy return for the type of company we are. Bopak's long-term commitment to invest €1 billion in industrial and gas terminals by 2023 and €1 billion in new energies and sustainable feedstocks remains unchanged. And on leverage, we confirm our ambition to maintain a healthy leverage ratio with a range of around 2.5 to 3 times going forward. As well, our progressive dividend policy, which aims to maintain or grow our annual dividend, remains unchanged. And this concludes my remarks from a more financial perspective in this presentation, and I would like to hand it back to Dick for the question and answer.

Thank you, Michiel. And with that, I would like to ask the operator to please open the line for question and answers.

Thank you, sir. Ladies and gentlemen, if you would like to ask a question or make a contribution on today's call, please press star 1 on your telephone keypad. We'll pause just for a moment to allow everyone an opportunity to signal for questions. Thank you. We'll take our first question from Rachel Fletcher from Morgan Stanley. Please go ahead. Your line is open.

Good morning, gentlemen, and thanks for taking my question. I have three more ones, please. So at the start of the year, you said that the outlook for the second half of 2023 was more uncertain, and it seems that the outlook has improved versus what you expected. I was hoping you could just outline what makes you more confident in the outlook for both the oil part of your business as well as chemicals, please. That's my first question. My second question is around the gearing ratio. So you're now slightly below the 2.5 bottom end of the range, the 2.5 to 3 times range. Should we expect this target range to come down at some point in the future? And then my third question, there were some news reports this week about a data breach at your Pengarang terminal in Malaysia. I was wondering if you could just talk about that, please. Thank you.

Okay, very good. I'll take the first and the third one, if that's okay, Rachel, and then I'll leave Michiel to answer your second one. To your first question, indeed, when we spoke about the outlook of the year 23 earlier, we said 910 to 950, and we said there was some uncertainty about the second half of the year. What you basically see with the results in Q1 is that We are more certain about the next six to nine month outlook and it's basically because we see the developments for demand in the main markets positively developing as we explained. So both from a demand for oil storage in the main hub locations, we see that that has positively contributed and what we can foresee for the remainder of the year in both occupancy and rate development is a positive outlook. I think on chemicals, as we indicated just now in the presentation, it's stable at the moment there's maybe some uncertainty towards the end of the year but still overall we are of the opinion that it's it's it's good to increase and give the guidance to the market of that minimum 950 so it gives you a bit of of color if I would put it in different words Rachel we basically pushed out the uncertainty and to the end of the year and towards 2024. And that's really uncertainty. We don't know, and we will update you and the rest of the market on that in our upcoming results calls. But that gave us the confidence to basically see what we can now foresee for the remainder of 2023 is a positive outlook, and hence the reason that we've increased the outlook for the full year. Then maybe to your third question, What we've seen is a data breach in a terminal in Malaysia that's PITSB, which is one of the terminals that we have in the Pengarang complex. The situation, as we've said, we take it obviously serious and regret that something like that is happening. We're currently running an investigation, but I think what is important to note is two things. One, it's confined to one location, and the location is PITSB, and that's a joint venture between Dialog and Valpar. And second of all, it has no impact whatsoever on the operation. So it's completely separated from the operational environment and the day-to-day environment. So the impact that it has for our customers in their day-to-day, in our ability to serve them is non-existent at the moment and also any of the other terminals of OPAC is not impacted whatsoever. So that's where we are on the situation in Malaysia. I hope that helps and then hand it over to Michiel.

Yeah, I'm happy to answer the question on the gearing ratio. So indeed we are just below the 2.5 to 3 times. If we look at the growth portfolio, we still have quite a few opportunities and already quite some announcements in the first quarter. So we will need a bit of headroom to finance that, the expansions in India and later on also for west of Canada. We also still have quite a bit of subordinated debt, and that is not included in this gearing ratio. I think there is an opportunity now to also take that also into account in our gearing, but also maybe longer term refinance the more expensive subordinated debt, which just regular debt, let's put it that way, and that will then also have an impact on the gearing ratio. I don't expect that we will move away from the 2.5 to 3 times. I think it's given where we are in the strategic ambitions which we have. It's a good range to play in for us, and it's also supporting our strategy, and we are confident that we can execute a strategy within that leverage range.

Right. Very clear. Thank you very much. Thank you. We'll move on to our next participant, Lampro Smiley from Kempen. Please go ahead. Your line is open.

Hi, good morning all, and congrats on another great quarter. I have a couple of questions. Regarding occupancy, we see that it has reached 92%. Obviously, the outlook remains favorable, but could we expect, or basically, what do you see to remain at such high levels, or would you expect a dip there? Next question would be on LNG. We see the recent acquisition with EMS Energy Terminal, but you removed yourself from the Hong Kong one. Do you see any other opportunities in the market or kind of that is for now? And then last question on the LA Terminal, is it still coming on stream by H1? Yeah, thank you.

Okay. Good morning, Lampros, and... Maybe first on occupancy, I think the guidance that we've given is very much expecting that the occupancy will not materially differ from where we are today, and that's based on what I just shared also to Rachel on our outlook for both the oil storage demand and also chemical storage demand. I think that is one. I think your second question was related to the LNG opportunities. Maybe just as a general comment, the AIMS terminal is not yet, we have not yet acquired it, so it's the intention to acquire, which we hope to close by October this year. We do see opportunities for further LNG projects, which we are currently working on. And that's outside Europe. They're in the public domain as well. And that's in Australia, and that's also in South Africa, where we are looking at LNG opportunities. If you would ask us, is there any bigger opportunity in Europe at the moment, we'll never say never. But the infrastructure that we've seen developing as a result of the energy crisis last year, with new energy facilities opening in, or FSU facilities opening in France and Germany, and given what we have in Eemshaven, as well as the fourth tank in Gate, it would be, at this point in time, with the current market circumstances, harder to see how that would lead to larger new infrastructure demands or us participating in those in the near future. And I think maybe on LA, on the... Yeah, LA, the latest... Morning, Lampos.

The latest timing is end Q1, beginning of Q3, so we're still well on track to deliver this project, Lampos.

Thank you. If I may sneak one more. Is there any progress on the strategic assessment of the chemical terminals?

Well, we announced the strategic review. We informed all our employees about the process. The process is ongoing. We have hired a financial advisor. We have launched the teaser into the market, so it will be an open auction process. We're working on the information memorandum, which we will submit to interested parties in May. Normally this process takes from start to finish somewhere, and I know this is a relatively wide range, somewhere between nine and 15 months, and that's a bit based on the experience we have. We have divested quite a few terminals in the past, and sometimes it's fast, sometimes it's a bit slower, but it's progressing well, but too early to give any sort of indication or more factual information on this. Thank you very much.

Thank you. Once again, ladies and gentlemen, if you would like to ask a question, please press star 1. We'll move on to our next participant, Thijs Belkerder from ABM Amro-Odo BHF. Please go ahead. Your line is open.

Yeah, good morning all. Congratulations on the strong Q1 start. First question is on your growth projects. You are now reporting cash returns above the 12% level. And you said, well, that's more or less how it should be. Does that mean that we should expect for growth projects that you are targeting around 12% going forward or that you now are lifting that target as well when looking at new growth projects. Second question is can we have some kind of guidance on tax rates for this year? And third question is on a location, Panama, can you update us on the developments there?

Okay, maybe I take the first two questions and then Dit can take the last question. I think on the growth projects, yeah, what you may expect is that at least we will deliver on the above 12% cash return. So some projects will come in higher than that. Some projects will be around that level. So if we look at the growth portfolio, we think that that is going to contribute to our cash return overall. So we're not pushing the cash returns to a higher level and declining project as a result of it, but we should be certain that these projects we bring to execution, that it's going to be supportive of our cash return ambitions. So that's one. I think on the tax rates, well, there is basically the same as last year, but last year we had to write off a deferred tax asset, which had quite a bit of impact on our tax line. So if you factor that out, normally, let's say on the tax rate, we give a guidance of around 20% of our net profit before tax.

Maybe on Panama, good morning. Nothing specific I would say to mention on the Panama performance. It's going in line with our own expectations and the business plan we set for ourselves. And that means that it continues to be a management of the local terminals very much focused on the commercial opportunities in that market to persuade customers in the bunkering between the Atlantic side and the Pacific side. And we've made good progress on that. So commercial occupancy is attractive. The team is performing well. And we continue to monitor that. So we're developing and performing in line with our own expectations that we set.

Okay. Thank you.

Thank you.

Thank you. Once again, if you would like to ask a question, please press star one.

all right yes because it appears oh sorry we have one question from querine model from ING please go ahead your line is open yeah good morning everyone maybe the questions have been asked already first of all congratulations there's a lot of good news coming from Rotterdam anyway so thank you and One question from my side is with regard to the bottleneck, is there any progress in that divestment disposal program? Can you update us on that?

Yeah, by the way, maybe just to start, no idea what other good news you're referring to when we talk Rotterdam, but that's for another discussion.

But clearly there's a high likelihood there's more good news to come from Rotterdam maybe in the coming weeks. But on this one, Pierijn, I think the process has started. mentioned it as well process has started we informed all the employees we have a teaser in the market it's an open auction process and working on the information memorandum which we will launch in in May typically the process I would expect somewhere between 9 and 15 months very hard to give you more exact indication because sometimes it runs faster and slower So too early to give you any update on specifics around any potential transaction because we're still not in that phase of the process.

Okay, and are you considering to sell them all three together because there are different locations or is that not to say yet?

Not to say yet. I think we're going through the process and yeah, but these kinds of processes, you may always expect different approaches from different parties. So although the intent is to sell all the terminals, yeah, you never know what kind of bids you get on the table. So it is a bit comparable to the transaction we did a few years ago where we effectively had Amsterdam, Hamburg and Alcaceras in one package. then you had parties who were bidding for the full package you had parties who were just bidding for an individual asset and then you need to sort of assess what is the best process and what brings most value at that time we sold them all to one party um but yeah that that's too hard to predict what the outcome is going to be but but normally i would expect that that people, well, there will certainly be bidders for the full package, but there might be also bidders for just individual assets, and then we need to look at it, what is the best for Valpar.

Okay, and then my next question is about to what extent is it positive for you that the Hartel has international storage facility is bankrupt? Is that positive for you? Is that visible?

Well, it's positive in the sense that, because if you bring capacity to the market, 1.3 million cubic meters, there's more capacity in the same market. Although part of that original idea was to bring some volume from Amsterdam, but then effectively it opens up capacity in Amsterdam. So it is helpful in the short term. longer term to be seen because we don't know what the outcome is going to be of that process I think from a storage industry point of view it's not very good to have a bankrupted terminal because it will make financial institutions maybe a bit more cautious on funding things in the right way or in the preferred way so that's not going to be helpful in my mind but We don't see any impact of that yet. So we still have a strong reputation to deliver our projects on time and within budget. But yeah, obviously any kind of these cases is not positive for the industry. But business-wise, short-term, it is positive, longer-term to be seen.

Okay, that were my questions. And I wish you good luck tomorrow with the visit of the king in Rotterdam.

thank you thank you thank you and that is indeed good news thank you we have um another question from thais belkander please go ahead your line is open yeah follow up on uh biden's uh plans in the usxd plans for renewables are you looking at or are you planning to make use of those plans in, let's say, expansions, for instance, in Houston and or, let's say, on the west coast of the U.S.?

Yeah, short answer is yes. Longer answer, Thijs, is it takes quite some time to study, obviously, in which way you can apply for certain of the funds available under the Inflation Reduction Act. I think overall what it does, and that's positive for the industrial development overall in the US and hence for demand for our services, it will generate a lot of new investment in an area where we can play an important role to support those investments with infrastructure. That's the positive part, and that's what we like. And obviously, where possible and applicable for us, we would apply for funds ourselves as well for the part of the investments that we have to do. So it's twofold as an impact, if that makes sense.

Yeah. And related to that, I saw a huge project being announced to protect the coast around Houston. Does that have any special implications for your terminals?

Not that we are aware of, not fully aware of the project that you're referring to. So not specifically that we are aware of, Thijs.

Okay. Very good. Thank you very much.

Thank you. Just because there's no further questions at this time, I'd like to turn the conference back to you for any additional or closing remarks. Thank you.

No, thank you very much. Thanks all for joining, for listening in, for your questions and If there's any further information that you need, you obviously know where to find Facona on the IR side or any of us. Wish you a great day and happy King's Day for tomorrow. Thank you. Bye-bye. Bye-bye.

Thank you for joining today's call. You may now disconnect.