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Ecoslops, a company that upgrades ship-generated hydrocarbon residues into marine fuels and light bitumen, says it achieved "very strong business growth in 2017" in a year that saw the company record year-on-year (YoY) improvements in revenue and sales of refined products as well as profitability for its first industrial unit in Sines.

Non-audited sales posted by the company's Portuguese subsidiary show that Ecoslops recorded a 40 percent increase in sales from EUR 4.3 million in 2016 to EUR 6 million last year.

Sales of refined products increased by more than 80 percent, and made up 65 percent of total revenue compared to 50 percent in 2016.

Production during the year amounted to 22,000 tonnes, representing a rise of 30 percent from 17,000 tonnes in 2016.

The production potential of the Sines unit is 30,000 tonnes per year, which the company says it aims to reach - depending on the availability of slops.

Ecoslops said the transformation of residues into commercial products remains above 98 percent.

At the end of 2017, Ecoslops had close to EUR 8.3 million in cash, thanks to the recent EUR 4.8 million capital increase (net of fees) and the positive operational cash flow at Sines.

The convertible bonds issued in February 2016 were all converted into new shares in 2017, strengthening the company's balance sheet. Gross debt amounted to EUR 1.9 million, excluding a grant from IAPMEI, which is partially refundable.

Mini-P2R design finalized

As previously reported, Ecoslops launched technical and economic studies of a new concept: the 'mini-P2R' - a reduced-sized unit designed to treat 4,000 to 8,000 tonnes per year and said to be specifically suitable for medium-sized ports.

This business line is designed to allow Ecoslops to capitalize on the expertise accumulated with the P2R, which has a capacity of 30,000 tonnes or more, while generating regular revenues (in equipment sales and technical assistance) and proving less capital intensive.

In its update this week, Ecoslops said the Mini-P2R design had been finalized by its technical committee and that a prototype will be built in H1 2018 before a scale-1 unit (size of a container) is constructed by the end of the year.

Marseilles permit obtained; 65% of capacity contracted

Last year, Ecoslops secured a building and operating permit for its new production unit at Total's La Mede refinery in southern France. Detailed studies have been launched and the first orders for equipment have been placed with the objective to start works in mid-2018 and open at the beginning of 2019.

By the end of 2017, Ecoslops says that more than 65 percent of the capacity of the new unit (20,000 tonnes out of a total 30,000 tonnes) has already been contracted for a seven-year period with local slops suppliers.

Antwerp 'progressing well'

Last June, Ecoslops signed a memorandum of understanding (MoU) with Antwerp Terminal and Processing Company (ATPC), a subsidiary of VTTI, to establish a micro-refinery unit in Antwerp with a minimum capacity to treat 60,000 tonnes per year and enable the regeneration of collected residues in the Amsterdam-Rotterdam-Antwerp (ARA) region by local slops collectors.

Commenting on the project this week, Ecoslops said it was "progressing well".

Egypt agreement

Ecoslops recently signed an agreement with Suez Canal Authority and the French government to perform a detailed feasibility study to look into creating an oil residue collection and recycling plant in the Suez Canal region.

Clients

Ecoslops says it now has a portfolio of "strong and reputable customers" - including Galp, Soprema and EDP - which enables the firm to sell all of its production.

In September, the company also announced that its agreement with Mediterranean Shipping Company (MSC) to utilize slops from the boxship transportation giant's vessels had been renewed.

Commenting on the company's performance, Vincent Favier, chairman and CEO of Ecoslops, remarked: "2017 is just the second year with our Portuguese industrial unit in Sines fully operational, but it is also a key year marked with a strong acceleration of our results and development. The Sines unit generated EUR 6M sales (+40% vs. last year including +80% for the sale of refined products) with a positive profitability at both EBITDA (approximately 25% of sales) and EBIT levels. This performance is due to the valorization of our products by our large international clients (GALP, SOPREMA...), the excellent performance of the industrial unit and the impact of the costs reduction initiated in 2016.

"Our project in Marseilles progressed favorably in 2017 with the filing of the permit, the launching of detailed studies and the signature of local supply contracts covering already 65% of the capacity. Construction is scheduled to start mid-2018 with operation starting at early 2019. Antwerp will follow Marseilles with a time lag of nearly 12 months considering common internal resources dedicated to the two projects. Several other projects are being reviewed (Suez Canal, Mini-P2R...) and will feed the pipeline of future growth. Lastly, the financial situation of the company strengthened again with the conversion of convertible bonds into new shares (EUR 5.5M) and the success of the capital increase at the end of 2017 (EUR 5.0M). Cash position at the end of 2017 was EUR 8.3M."