StoltThe corporaTe magazine of STolT-nielSen leimiTed | anpril 2016 Christer Olsson December 28, 1945 – December 29, 2015 Our Chairman, Christer Olsson, passed have been led to believe that a return can away on Thursday December 29, 2015, be made by building ships on speculation after a long battle with cancer. He joined without having a sound understanding of our Board in 1992 and in 2009, when my the dynamics that drive demand for such father decided to step down after 50 years ships. The ships have been built simply as Chairman, Christer took over and because money is cheap and they were remained Chairman until his passing. cheap to build. The cheap money has Christer was wise, intelligent and a highly actually enhanced the problem. Similar experienced shipping man. You can examples can be found across many imagine the job of taking over the industries. Central banks are now chairmanship of a Company from the discussing so-called ‘helicopter drops’. founder who had held the position for The idea is to bypass the banks and invest 50 years. Christer handled the job as if it directly in infrastructure projects. Since was just another day at the office. He most countries are broke (or close to being managed my father and the Board broke), the money to pay for these projects A message from the CEO superbly, in addition to being an excellent will be printed by the central banks and Chairman. He is dearly missed. most likely will never be repaid. The theory The economic challenges that we are is that such helicopter drops will give the faced with globally are the results of simply man on the street money in his pocket too much capacity. Over the past 15 to 20 and, as a result, create the demand that years, because of the phenomenal growth will lead to inflation. we have seen in developing countries, Whether this latest attempt succeeds primarily China, too much capacity of or not is difficult to predict. Regardless, almost everything has been created. An I think the challenge we (the global overabundance of commodities, too many economy) face is the large overcapacity ships to transport the commodities, too created by the unrealistic expectation that many factories to process the commodities, rapid demand growth would continue too many container ships to transport the indefinitely. We in the developed countries finished products, etc., etc. So today we have been living beyond our means. We are back to ‘normal’ demand, but with too have borrowed to consume as nations and much supply. That is what is driving the as individuals. As private individuals, we low inflation and, in some places, have had to deleverage and still, eight deflation. years since the financial crisis, with few The US Federal Reserve and the exceptions, most nations have not been European Central Bank have successfully able to create a budget surplus. prevented a collapse of the banking system The overcapacity will be made even by giving support in the form of liquidity worse by the lower consumption resulting and cheap loans necessary to keep the from the rapidly evolving sharing and reuse banks functioning. However, the economy. Uber and Airbnb are perfect quantitative easing has not led to increased examples of the sharing economy, and consumer demand. On the contrary, the reusing the same plastic bag each time you cheap money created by quantitative easing visit the grocery store is an example of the has led to the misallocation of capital and reuse economy. In addition, we have the capital expenditures. As an example, in a ongoing evolution of new fuel-efficient desperate attempt at finding yield, funds technologies. This is all great for the environment and for mankind in the long wisdom. Finally, Samuel Cooperman has In this issue… run, but it will be a challenge for the global been nominated to become the Chairman economy until we achieve a balance in of the Board, succeeding Christer Olsson. supply and demand. And that balance, I look forward to working with Sam and FEATURES I am afraid, will take a very long time. drawing on his wealth of knowledge and 2 After Isaac : The long road back Historically, economic conditions like we experience. 9 Peter Koenders: The ‘IT’ guy see today have only been resolved by war. Congratulations to Captain Daniel 14 Global Shared Services Center gets The global tension caused by extended Strydom on his appointment as General the job done economic stagnation often leads to Manager, Stolthaven Houston. Having 17 Houston barge dock now serves two conflict and the demand for war materiel, served as Terminal Manager since June combined with the destruction of war, 2014, he succeeds Mike Sealy, who stepped NEWS absorbs excess supply. With so many in as interim General Manager in March 8 Christer Olsson 1945 –2015 hotspots around the world, I pray it does 2015. Daniel sailed with Stolt Tankers for 12 New appointments for Manila Service Desk team not come to war this time round. 12 years before coming ashore in 2009 in 12 Rolf Habben Jansen joins Stolt-Nielsen The time for consolidation in the parcel Houston – another example of how we Board of Directors tanker industry is ripe. We have, over the actively leverage our experience and 13 New offices for Stolt-Nielsen years, worked on finding partners to merge synergies in Tankers to enhance our Switzerland AG or pool with but we have not succeeded. Terminal operations. 13 Stolt-Nielsen signs historic Declaration to fight wildlife trafficking I suspect the other players don’t like us. Compliments also to Sérgio Almeida, 16 New General Manager at Stolthaven Or maybe they are afraid of us? As I who has been promoted to General Houston mentioned in the previous issue of Stolten , Manager of Stolthaven’s Dagenham 16 Sérgio Almeida promoted to GM, Stolthaven Dagenham I suspect the non-traditional owners will terminal. Sérgio joined Stolthaven as seek an exit. I know several who are now Construction & Engineering Manager at REGULARS realising how operationally challenging Dagenham in February 2015 and was 19 Share Price Performance our particular industry is and that a quick promoted to Project Manager in July. He 21 Stolt Around the World flip of their position is not as easy as was previously with LBC Tank Terminals. they originally envisaged. With a large Both Daniel and Sérgio report to Marco orderbook, and what I predict will be a Dalmeijer, Global Business Director, deflationary economy, savings through Stolthaven. operational synergies created by consolidation is, I predict, the way to go. We will continue to seek opportunities. As I am finishing this message, we are about to report SNL’s first quarter earnings for 2016. While it was a good I am pleased to welcome Rolf Habben quarter overall, the business environment Jansen, Chief Executive Officer of remains challenging. We will continue to StVolume XLI Noo. 1 l ten Hapag-Lloyd AG, to the Board of manage our businesses intelligently and Editor Valerie Lyon Directors of Stolt-Nielsen Limited. In conservatively, and to capitalise on growth Cover photograph: Bram Belloni addition, Tor Olav Trøim, a Director and opportunities that may arise. STOLTEN magazine is published by Stolt-Nielsen M.S. Ltd Vice Chairman of Golar LNG Limited 65 Kingsway, London WC2B 6TD email: [email protected] Website: www.stolt-nielsen.com and a partner in Magni Partners UK, has No part of STOLTEN magazine may be reproduced without been nominated for election as a Director written permission from the publisher. © Stolt-Nielsen Limited at the upcoming Annual General Meeting Produced by PeterDoltonDESIGN, Suffolk, UK. on April 21, 2016. We look forward to Niels G. Stolt-Nielsen benefiting from their experience and April 2016 Hurricane Isaac left the Stolthaven New Orleans terminal with US$80 million of damage, lost customers and a daunting amount of new capacity to be filled. Four years later, demand is strengthening and the tanks are filling up. As Stolten finds out, that’s down to a renewed focus and the sheer spirit and determination of the entire Stolthaven New Orleans team. After Isaa c: the When Hurricane Isaac made landfall late in the day on August 28, 2012, it was Terminal Manager in 2012 before being named not expected to have a major impact, especially compared with Hurricane General Manager in 2015. Katrina , the so-called ‘Storm of the Century’ that struck in 2005. But a strong While the impact of the storm itself was bad storm surge, combined with intense enough, with upwards of US$80 million in According to a report issued by the National damage to the terminal, circumstances made it downpours, resulted in heavy flooding. Hurricane Center, Plaquemines Parish, the even more challenging. Stolthaven New home of Stolthaven New Orleans, Orleans was in the midst of adding 23 new experienced the worst flooding of the storm, tanks – Phase 5 of its ongoing expansion recording depths of 10 to 17 feet above ground plans. So when the skies cleared and the level. floodwaters receded, Watt and his team were For Captain Philip Watt, General Manager confronted with a grim situation. of Stolthaven New Orleans, it was one of “Not only did we lose customers thanks to the most difficult moments in his long career the storm, but we had new capacity that with Stolt-Nielsen. Starting in 1982, Watt needed to be filled,” said Watt. “Our spent his first 22 years at sea with Stolt utilisation fell from 99% before the storm to Tankers, the last 16 of them as a Captain. He about 70%.” came ashore in 2004 as Port Superintendent And so began the long journey back for in Houston and moved to New Orleans in Stolthaven New Orleans – a journey that 2008 to become Operations Manager for began with Stolt-Nielsen Limited’s decision to Tankers & Terminals.