AlphaValue Corporate Services Fundamental Analysis FR
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AlphaValue Corporate Services
This research has been commissioned and paid for by the company and is deemed to constitute an acceptable minor non-monetary benefit as defined in MiFID II


Bloomberg   ALESA FP
Other Energies  /  France  Web Site   |   Investors Relation
The cleantech making oil residues green
Upside 189%
Price (€) 8
Market Cap (€M) 35.3
Money Making

Ecoslops aims at being a high value-added player: it collects hydrocarbon residues and sells renewed fuels.

Ecoslops is a play on its ability to grow the volume of value-added products:

1) business development (expanding the asset base with new projects);
2) availability of slops;
3) smooth running of the plant;
4) commercial conditions in buying and collecting slops;
5) fuel product prices.

The company has climbed a steep learning curve during the ramp-up of its Sines plant. Such an engineering development and industrial optimisation have taken several years. Ecoslops is the only player mastering this know-how and is partnered with Heurtey Petrochem, the downstream engineering specialist.

This, coupled with a track record (being able to show a successful project in operation), represents a strong moat and contributes to position Ecoslops as the solution of choice to the slops conundrum across global ports.

The effective roll-out of upcoming units should confirm Ecoslops’s proposition and enhance its attractiveness, while benefiting from the acquired experience.


We base our revenue estimates on the expected evolution of product prices, which is linked to AlphaValue’s crude oil (Brent) price forecasts and on a standard product slate.

The price paid for slops is also affected by the oil price, in a non-linear manner: we assume a lesser sensitivity to oil at lower prices, as the slops are less of a convenient option for cement plants and steel mills to buy as heating fuel.

Source: AlphaValue estimates

Source: AlphaValue estimates

Opex depends on local economics affecting the cost structure of the project (e.g. likely different labour costs in Portugal vs. Marseille). We expect c.€2.5m for a standard unit. A larger plant offers economies of scale, as in the case of the Antwerp project, where nominal capacity is assumed at 200t/day.

Assuming Ecoslops is the only shareholder of projects (actual ownership structure may vary), the EBITDA should turn seamlessly into cash flow.

The profitability of its project depends on a number of variables, and most notably the price of oil, slops and oil products.


A “standard” project of the size of Sines or Marseille (25-30kt / year) requires set-up investments of around €15m (or generally in a $12-18m range).

The bulk of the investments should occur in 2019-21 (as we assume the build-up of two plants and some mini P2Rs).

We expect each P2R project to require six-twelve months of studies, 12 months for construction.

We allowed for the addition of 1 Mini P2R from 2020 and 2 in 2021 with capex at €3.5m per unit.

Return on capital

Capacity ramp-up and estimates of Brent at $70/bbl should result in a ROCE of around 25% in 2022. The ROE would stand at c. 40%, boosted by a 41% EBIT margin, 84% asset rotation and a 1.9x financial leverage.

Change 19E/18 Change 20E/19E
  12/18A 12/19E 12/20E 12/21E €th of % total €th of % total
Total -380 278 1,736 7,424 658 100% 1,458 100%
Sines 1,500 2,828 3,424 3,472 1,328 202% 596 41%
Marseille 0.00 -300 730 3,131 -300 -46% 1,030 71%
ARA 0.00 0.00 0.00 2,490 0 0% 0 0%
Mini P2R projects 0.00 0.00 333 1,331 0 0% 333 23%
Other/cancellations -1,880 -2,250 -2,750 -3,000 -370 -56% -500 -34%
2.66% 11.0% 21.0%  
27.0% 30.3% 30.0%  
19.9% 32.6%  
Mini P2R projects
42.2% 42.2%  
Changes to Story : 26/09/2019, Changes to Forecasts : 26/09/2019.