Stolt-Nielsen annual report 2023 by CEO Udo Lange

2023 delivered another strong set of operating results, which reflect the strength of the company and our diverse portfolio of businesses. The market has continued to work in our favour, yet we believe our solid performance comes down to our growth strategy and the sustained efforts of our people to deliver operational excellence. This exceptional performance is testament to the hard work and commitment of every employee at Stolt-Nielsen and I would like to thank everyone for their dedication and ongoing passion to keep innovating. It is this amazing team that consistently delivers a high-quality, reliable customer experience centred on flexibility. I’d also like to thank our loyal customers. Without their trust in us to safely handle their business, we would not be able to achieve the results that we have seen.

Performance

2023 net profit was $296.7 million, compared with $280.9 million in 2022. This includes an incremental loss provision of $155.0 million (net profit impact of $115.0 million) in the second quarter related to the MSC Flaminia incident in 2012. Stolt-Nielsen’s cash flow from operations increased from $619.8 million in 2022 to $721.4 million in 2023. Earnings per share were $5.54 in 2023, compared with $5.25 in 2022. Net debt reduced from $2,038.2 million in 2022 to $1,761.3 million at the end of 2023, bringing debt to tangible net worth down to 1.00 compared to 1.08 a year ago. Shareholders’ equity was $1,906.1 million at year end, compared with $1,721.7 million a year ago.

Stolt Tankers’ operating revenue ended the year at $1,709.8 million, up from $1,497.1 million in 2022. Operating profit also increased to $371.1 million from $205.1 million as the positive momentum in the chemical tanker market that we saw in the second half of 2022 continued throughout 2023. A low newbuilding orderbook for chemical tankers combined with stable chemical demand drove continued tightness in the segment. As a result, Stolt Tankers generated a record financial performance underpinned by higher contract freight rate renewals. In November, Stolt Tankers reached an agreement with Wuhu Shipyard in China to build six 38,000 deadweight tonne stainless steel parcel tankers. These sustainable ships will not only help Stolt Tankers in its ambition to reduce its carbon intensity by 50 percent (relative to the 2008 baseline) by 2030, they will also help reduce customers’ Scope 3 emissions.

For 2023, results at Stolthaven Terminals improved slightly in line with expectations. Full-year operating revenue increased to $299.8 million from $276.2 million in 2022. Operating profit was $105.0 million, up from $89.2 million. We also saw an EBITDA margin improvement, due to our programme to replace lower-margin business with longer-term opportunities at higher rates.

At Stolt Tank Containers, operating revenue decreased to $699.5 million from $894.6 million in 2022, with operating profit of $117.2 million, prior to the MSC Flaminia provision of $155.0 million, down from $172.7 million. After an unprecedented two years’ strong performance for STC, the markets returned to more normalised levels. This was particularly noticeable during the second half of the year. Transportation rates broadly stabilised across most regions and by the end of 2023 we saw a similar impact on demurrage revenues. Our team continued to focus on increasing shipments to compensate for some of the margin lost this year. During the past three years our team has worked on making our digital platform scalable and cost efficient, meaning that the majority of our business can now be conducted digitally. In 2023, we focused on volumes and grew shipments by 10.0 percent. Our focus on sustainability continued and we have introduced emissions estimates to our online booking system to help our customers manage the carbon footprint of transporting their products with us.

Stolt Sea Farm sold a record 6,814 tonnes of turbot in 2023, a 2.5 percent increase compared to 2022 and sole sales volumes reached a record high of 1,728 tonnes, a 15.4 percent increase. Steady demand throughout the year for sole allowed for solid price increases. Full-year operating revenue increased to $110.8 million, compared with $102.7 million in 2022. Operating profit was $24.3 million, up from $19.5 million the previous year, as 2023 benefited from a gain on the fair-value evaluation of biomass of $3.9 million compared with a fair-value loss of $1.0 .Udo Lange, CEO Stolt-Nielsen Limited

For more information visit www.stolttankcontainers.com