Great Eastern Shipping Co. Ltd. · NSE:GESHIP
Great Eastern Shipping — The Great Eastern Shipping — Investor Presentation (September 2017)
32 slides from Great Eastern Shipping's investor presentation, September 2017
Slide 1: Business & Financial Review September 2017
The Great Eastern Shipping Co. Ltd. Business & Financial Review September 2017
Slide 2: Forward Looking Statements
Forward Looking Statements Except for historical information, the statements made in this presentation constitute forward looking statements. These include statements regarding the intent, belief or current expectations of GE Shipping and its management regarding the Company’s operations, strategic
Slide 3: Corporate Profile
Corporate Profile The Great Eastern Shipping Company Offshore Shipping (Bulk) (Through wholly-owned subsidiary Greatship (India) Limited) Tankers - Crude Dry Bulk Logistics Drilling - Products/LPG India’s largest private sector shipping company. Over 69 years of experience 3
Slide 4: Shareholding Pattern
Shareholding Pattern Shareholding Pattern as on June 30, 2017 FII/FPI 23% Promoters 30% Govt/FI 20% Public Corporate 21% Bodies 6% 4
Slide 5: Shipping business - owned fleet
Sr. No. Vessel Name Type Shipping business - owned fleet 1 Jag Lalit Suezmax 2 Jag Lok Suezmax Sr. No. Vessel Name Type 29 Jag Vishnu VLGC 3 Jag Lateef Suezmax 30 Jag Vidhi VLGC 4 Jag Lakshita Suezmax 2 Gas Carriers; Age – 22.5 years 5 Jag Laadki Suezmax 31 Jag Anand Capesize 6 Jag Leena Suezmax 32
Slide 6: Vessels on Order
Vessels on Order Vessels on Committed Order & Expected Delivery Vessel Yard Expected Delivery 1 Secondhand Hyundai Heavy LR2 Product Tanker Industries (Ulsan), South Q2/Q3FY18 Korea Mitsubishi Heavy 1 Second hand Industries, Nagasaki Q2FY18 Mediumsize Gas Carrier Shipyard, Japan 6
Slide 7: Key points on Tanker Markets – Q2CY17
Key points on Tanker Markets – Q2CY17 •VLCC 5 yr old asset prices fell by 8.5% Y-O-Y Asset Prices: •Suezmax & Aframax 5 yr old asset prices fell by 18% Y-O-Y Freight rates: •BCTI fell by 36% in H1CY2017 & BDTI by 44%. •Crude oil supply increased due to Libya and Nigeria crude output rise. However, C
Slide 8: Tankers – Asset Price Movement (5-year old)
Tankers – Asset Price Movement (5-year old) USD mn VLCC Suezmax Aframax VLCC Suezmax Aframax 180 90 80 160 70 60 140 50 40 120 30 100 20 10 80 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 60 2015 2015 2016 2016 2016 2016 2017 2017 40 20 0 Source – Industry Reports 8
Slide 9: Downward Movements of BDTI & BCTI
400 500 600 700 800 900 1,400 1,000 1,100 1,200 1,300 Aug-12 Dec-12 Apr-13 Aug-13 Dec-13 Apr-14 Source – Industry Reports Aug-14 Dec-14 Apr-15 Aug-15 Dec-15 Apr-16 Baltic Dirty Tanker Index Aug-16 Dec-16 Apr-17 Aug-17 300 400 500 600 700 800 900 Aug-12 Dec-12 Apr-13 Aug-13 Dec-13 Apr-14 Aug-14 Dec-1
Slide 10: Crude tanker rates decreased; demand exceeded supply
Demand has exceeded supply which has lead to drawdown in inventory million Supply Demand Refinery Throughput (RHS) barrels per day 99 81 97 80 95 79 78 93 77 91 76 89 75 87 74 85 73 2013 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2014 2014 2014 2014 2015 2015 2015 2015 2016 2016 2016 2016 2017 2017 •
Slide 11: Crude & Products Demand has increased in Q2CY2017
Crude & Products Demand has increased in Q2CY2017 (Y-O-Y) • Crude: Majority of the demand is principally fuelled by positive growth in OECD Europe & North America. • Products: Majority of the demand is principally fuelled by positive growth in Non- OECD Asia & OECD Europe Source – Industry Reports
Slide 12: Refining margins high on healthy demand
Margins have been high, driven by healthy demand & limited available refining capacity • Refining margins were high due to demand being strong, higher refining maintenance in Asia and outages in Latin America & West Africa. Refining margins in Europe and Singapore got a boost from lower crude prices
Slide 13: China imports higher crude oil than H1FY2016
In H1FY2017, China imports 14% higher crude oil than H1FY2016 US Crude Oil Imports (‘000 bpd) China Crude Oil Imports (‘000 bpd) 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 8,800 9,800 8,600 9,100 8,400 8,400 8,200 7,700 8,000 7,000 7,800 6,300 7,600 5,600 7,400 4,900 7,200 4,200 7,000 3,500 J
Slide 14: World Fleet Growth – Crude Tankers
World Fleet Growth – Crude Tankers Tanker Fleet - mn Dwt 27-Jul-17 1-Jan-16 1-Jan-15 1-Jan-14 VLCC 223.73 200.00 193.75 186.13 Suezmax 76.78 71.09 69.68 68.43 Aframax 68.02 64.37 64.15 63.71 Total (80k+) 368.53 335.46 327.58 318.27 Order Book - mn dwt 2017 2018 2019+ Total Orderbook as % of current
Slide 15: World Fleet Growth – Product Tankers and VLGC
World Fleet Growth – Product Tankers and VLGC Product Fleet - mn Dwt 27-Jul-17 1-Jan-16 1-Jan-15 1-Jan-14 LR2 36.20 30.44 27.42 26.93 LR1 25.98 23.75 23.72 23.61 MR/Handy (35k+)* 92.45 82.95 78.40 75.74 Total (35k+) 154.63 137.14 129.54 126.28 Order Book - mn dwt 2017 2018 2019+ Total Orderbook as %
Slide 16: Key points on Dry Bulk Markets – Q2CY17
Key points on Dry Bulk Markets – Q2CY17 • Capesize 5 year old asset prices rose by 36% in H1CY2017 Asset Prices: • Panamax & Supramax 5 year olds asset prices rose by about 25% in H1CY2017 • BDI dropped to 830 from 26 months high of 1,338 Freight rates: end of the quarter Q2CY2017 and recovered to 1
Slide 17: Bulkers – Asset Prices (5-year old)
Bulkers – Asset Prices (5-year old) Capesize Panamax Supramax Capesize Panamax Supramax 180 40 160 35 30 140 25 20 120 15 100 10 5 80 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 60 2015 2015 2016 2016 2016 2016 2017 2017 40 20 0 Dry Bulk asset prices rose significantly in H1CY2017 compared to previous 3 half years. S
Slide 18: Baltic Dry Index (August 2012 – August 2017)
Baltic Dry Index (August 2012 – August 2017) Dry Bulk freight index hit 26 month high during H1CY2017 Baltic Dry Index 2,700 2,337 2,200 1,700 1,338 1,200 700 290 200 Aug-12 Aug-13 Aug-14 Aug-15 Aug-16 Aug-17 Dec-16 Dec-12 Dec-13 Dec-14 Dec-15 Apr-13 Apr-14 Apr-15 Apr-16 Apr-17 Baltic Dry Index drop
Slide 19: Steel Production & China's Iron ore imports have grown
Steel Production & China’s Iron ore imports have grown significantly Steel Production increased 5% in H1CY2017 (Y-O-Y) World Steel China Steel % Growth World % Growth China 2000 15% 1500 10% 1000 5% 500 0% 0 -5% 2013 2014 2015 2016 H1CY16 H1CY17 China’s iron ore import grew 9% in H1CY2017 (Y-O-Y) Au
Slide 20: Coal imports by China up by 23% in H1CY2017
-5.0 5.0 0.0 10.0 15.0 -15.0 -10.0 mt Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Source – Industry Reports Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 China coal imports change (Y-O-Y) Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Coal imports by China up by 23% in
Slide 21: World Fleet Growth – Dry Bulk
World Fleet Growth – Dry Bulk Fleet - Mn Dwt 27-Jul-17 1-Jan-17 1-Jan-16 Capesize 323 315 309 Panamax 202 196 195 Handymax 195 189 180 Handysize 95 94 93 Total 815 794 776 Orderbook - mn dwt 2017 2018 2019+ 2020 Total Gross Orderbook %Fleet 2% 3% 2% 0% 7% Slippage – 34% (YTD 2017) Source – Industry
Slide 22: Scrapping picks up for tankers, slows for drybulk
Scrapping picks up for tankers, and slows down for drybulk Scrapping as % of world fleet (year-wise) Vessel Fleet as on Scrapping Category Aug 17 YTD 2017 2016 2015 2014 (in mn dwt) (% of beginning fleet) Crude 370 0.92% 0.35% 0.23% 1.60% Product 154 0.44% 0.62% 0.61% 1.19% Dry Bulk 816 1.17% 3.67%
Slide 23: Greatship (India) Limited Business Review Sept 2017
Greatship (India) Limited (a 100% subsidiary) Business Review Sept 2017
Slide 24: Offshore business - Fleet Profile
Offshore business- Fleet Profile The Greatship Group Current Owned Fleet Fleet Utilization • 4 Jack Up Rigs (350ft) Extent of coverage of • 4 Platform Supply Vessels (PSV) fleet's operating days Category (per cent) (FY18) • 8 Anchor Handling Tug cum Supply Vessels (AHTSV) PSV 29 ROVSV 53 • 2 Multi
Slide 25: Key points on E&P markets – Q2CY17
Key points on E&P markets – Q2CY17 Day rates: • Day rates for both AHTS & PSV have come off by ~45%-50% since 2014 Fleet Growth: • Rigs: Remains flat in Q2CY17 • OSV’s: Remains flat in Q2CY17 Fleet Utilization Levels: Around 50% Slippage: • OSV – 60% - 70% YTD2017 • Rigs – 60% - 70% YTD2017 24
Slide 26: No signs of recovery in Offshore E&P spending in Q2CY17
No signs of recovery in Offshore E&P spending in Q2CY17 • Drilling demand has been declining continuously since the peak in 2014 • With the Brent oil price showing signs of stabilization at lower levels, Offshore E&P spending which had come off significantly since 2014 shows no signs of recovery yet
Slide 27: Global Fleet Supply – Offshore
Global Fleet Supply – Offshore Fleet & Orderbook (Nos) Jackup Rigs AHTSVs PSV Current Fleet 546 2105 1642 Orderbook 97 133 172 % of O/B to current fleet 18% 6% 10% • Q2CY2017 actual deliveries have been far lower than scheduled. Due to bleak employment scenario owners have refrained from taking deli
Slide 28: Financial Highlights Q1 FY 2017-18
FINANCIAL HIGHLIGHTS Q1 FY 2017-18
Slide 29: Q1 FY 2017-18 Financial Highlights
Q1 FY 2017-18 Financial Highlights Standalone Key Figures Consolidated Q1 FY'18 Q1 FY'17 (Amount in Rs. crs) Q1 FY'18 Q1 FY'17 Income Statement 587.15 477.72 Revenue (including other income) 857.43 889.59 274.01 249.64 EBITDA (including other income) 428.76 526.47 72.35 103.56 Net Profit 103.56 247.
Slide 30: Q1 FY 2017-18 Financial Highlights
Q1 FY 2017-18 Financial Highlights Standalone Key Figures Consolidated Q1 FY'18 Q1 FY'17 (Amount in Rs. crs) Q1 FY'18 Q1 FY'17 Key financial figures 46.67% 52.26% EBITDA Margin (%) 50.01% 59.18% 5.57% 8.88% Return on Equity (ROE) (%) 5.70% 13.69% 6.27% 7.99% Return on Capital Employed (ROCE) (%) 5.8
Slide 31: Q1 FY 2017-18 Performance Highlights
Q1 FY 2017-18 Performance Highlights Breakup of revenue days Revenue Days Q1’FY18 Q1’FY17 Owned Tonnage 3,998 2,794 Inchartered Tonnage 77 121 Total Revenue Days 4,075 2,915 Total Owned Tonnage (mn.dwt)* 3.80 2.49 * As on 30th June 2017 Mix of Spot & Time Days (in %) Q1’FY18 Q1’FY17 Average TCY Deta
Slide 32: Thank You
THANK YOU visit us at www.greatship.com
The Great Eastern Shipping — Investor Presentation (September 2017) on 6ix