Vopak narrows 2024 profit outlook range on strong fuel storage demand
Adds CEO's comment in paragraph 3
By Alban Kacher
Oct 30 (Reuters) -Vopak VOPA.AS raised the lower end ofits 2024 core profit outlook range onWednesday after reporting third-quarter profit slightly ahead of expectations, as the Dutch tank storage firmcontinued to see solid demand for its infrastructure services.
The Rotterdam-based company now expects 2024 earnings before interests, taxes, depreciation and amortization (EBITDA) between 930 million euros ($1.01 billion) and 950 million euros, compared with a previous guidance of 920-950 million euros.
Vopaksaw sustained "healthy" demand in the third quarter, which supported proportional EBITDA growth, and maintained occupancy rates at high levels, CEODick Richelle said in a press release.
The company, which operates oil and gas terminals and storage facilities worldwide, posted an EBITDA of 233.3 million euros for the third quarter, while analysts expected 231 million euros, according to consensus figures quoted by ING.
However, compared to 2023, Vopak saw a decrease in revenue and core profit in the quarter, mainly due to divestment impacts.
The group also flagged "temporary technical challenges with financial implications" at its EemsEnergyTerminal in the Netherlands, and said itaims to resolve these issues in 2025.
In July,Vopak upgraded its 2024 EBITDA target for the second time this year amid strong demand across its markets and expanded terminal capacity that boosted second-quarter results.
Instability in the Middle East has stretched global energy supply routes, while Russia's war on Ukraine has pushed European countries to seek alternative oil and gas supplies, increasing demand for storage space.
Vopak has been looking to expand its gas and industrial terminals to increase cash returns and to shed less profitable assets in the oversupplied chemicals market.
($1 = 0.9243 euros)
Reporting by Alban Kacher; Editing by Eileen Soreng
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