CEO Talks: Solid Q1/2020 results behind but the future brings unprecedented uncertainty
Neste’s President and CEO Peter Vanacker answers questions about the company’s first quarter 2020 and shares his vision of the post-corona world.
How do you see Neste’s financial performance in Q1/2020?
"I am very proud of the hard work done by our people during this crisis. We had a solid start to the year considering the negative market impacts caused by the global coronavirus pandemic in the latter part of the quarter. Our comparable operating profit totaled EUR 408 million, which is more than in the corresponding period last year. In addition, our Renewable Products’ sales volumes were high, and our renewables facilities reached a new quarterly production record. This is an excellent example of the passion our people put into their work, something which continuously keeps astonishing me.”
“That said, we take the risks relating to COVID-19 very seriously and acknowledge that visibility into the future is now extremely low. Our primary objective is to ensure the health and safety of our people, customers, contractors and other external partners. At the same time, we want to make sure our customers can get the services and products they need.”
How is the coronavirus pandemic affecting Neste’s operations at the moment?
“I have been overwhelmed by the readiness to cooperate, in the society at large and at Neste. For the time being, there are no effects on the delivery of our products or services. Refineries, harbours and terminals are operating normally. But due to the developing situation, we are intensively monitoring and evaluating the pandemic changes in order to ensure the safety and health of our people and to ensure our business continuity. Despite the corona situation, our company strategy has not changed and we continue to work for our purpose.
How do you see the outlook for renewable fuels?
“None of us has a crystal ball but we are likely to see unprecedented volatility in the fuel market. As a consequence, we anticipate a challenging market environment in the oil products business. We may also see a very tight renewable feedstock supply, but remain confident in the renewable fuels markets. We expect biofuel regulations and mandates to continue supporting renewable diesel demand. Many governments and companies are highly committed to reducing transportation-related emissions.”
“Our strategy for sustainable aviation fuels has not changed, either. We are committed to serving airlines in their emission reduction targets as soon as aviation recovers. We are well positioned to meet the increasing demand with our current 100 kta available capacity, and our Singapore renewables production capacity expansion. We are currently also investing in a feasibility study to enable the production of renewable aviation fuel in Rotterdam. We target to have the full capacity to produce over 1 million tonnes of renewable jet fuel globally by the end of 2022.”
How do you see the future, is fighting climate change still on your agenda?
“While it is important to tackle the coronavirus, we also need to look for ways to help rebuild the world after the pandemic. The climate crisis is still happening and needs to be addressed.”
“We now have a golden opportunity to build a sustainable and resilient economy and society. Investments in climate-resilient infrastructure, green innovation and generally the transition to a low-emission future can drive short-term job creation and economic recovery. It should be stressed that this work requires global collaboration. To start with, we have joined an alliance of cross-party political decision-makers, businesses, NGOs and other stakeholders in a call for a Green Recovery after the coronavirus crisis in Europe. We believe that the efforts devoted to the economic recovery after this pandemic must pass the test of creating a healthier planet. The climate crisis will not disappear, as the COVID-19 crisis will, one day.”