Great Eastern Shipping Co. Ltd. · NSE:GESHIP
Great Eastern Shipping — The Great Eastern Shipping — Investor Presentation (August 2019)
43 slides from Great Eastern Shipping's investor presentation, Aug 28, 2019
Slide 1: Business Overview
BUSINESS OVERVIEW 28 August 2019
Slide 2: 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 directions, prospects and f
Slide 3: Corporate Profile
CORPORATE PROFILE 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 71 years of experience 3
Slide 4: Shareholding Pattern
FII/FPI 20% Promoters 30% SHAREHOLDING Govt./FI 24% PATTERN Public 19% Shareholding Pattern as on 30 June 2019 4
Slide 5: Fleet Profile
FLEET SHIPPING PROFILE Fleet DWT Number of Ships Average Age (Yrs.) Crude Carriers 1,608,683 12 13.88 Product Carriers 987,207 17 11.79 Gas Carriers 224,113 5 17.92 Dry Bulk Carriers 1,026,462 13 6.80 Total 3,846,465 47 11.69 OFFSHORE Fleet Number of Units Average Age (Yrs.) Jack Up Rigs 4 7.84 Plat
Slide 6: Philosophy
PHILOSOPHY | BUSINESS
Slide 7: 4 Keys to Our Success
4 KEYS TO OUR SUCCESS In-House Dynamically Strong Diversified technical & managing balance Fleet commercial cycles sheet management 7
Slide 8: Net Debt/Equity & Total Capital Employed (Consolidated)
NET DEBT/EQUITY & TOTAL CAPITAL EMPLOYED (CONSOLIDATED) USD Mn 3,000 0.80 0.70 2,500 0.60 2,000 0.50 1,500 0.40 0.30 1,000 0.20 500 0.10 - 0.00 FY1993 FY1994 FY1995 FY1996 FY1997 FY1998 FY1999 FY2000 FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY
Slide 9: Dividend/Share (30+ Years Continuous Dividend)
- 2.00 4.00 6.00 8.00 10.00 12.00 14.00 16.00 INR/Share FY1993 FY1994 FY1995 FY1996 FY1997 FY1998 FY1999 FY2000 FY2001 FY2002 DIVIDEND/SHARE FY2003 Dividend/Share FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 Dividend Yield (RHS) FY2012 FY2013 FY2014 FY2015 FY2016 (30+ YEARS CONTINUOUS DIV
Slide 10: ROE & ROCE (Consolidated)
ROE & ROCE (CONSOLIDATED) 45% 40% Average ROCE: 12% 35% Average ROE: 18% 30% 25% 20% 15% 10% 5% 0% ROCE (Consolidated) ROE (Consolidated) Average ROCE Average ROE 10
Slide 11: BWTS & Scrubber Installation Schedule
BWTS & SCRUBBER INSTALLATION SCHEDULE 40 35 35 30 25 No. of Vessels 20 15 12 8 9 10 7 6 7 5 1 0 Installed To be Installed CY2019 CY2021 CY2022 CY2023+ BWTS Scrubber • Total 8 Vessels have been fitted with BWTS and 35 vessels are scheduled to be installed with BWTS • 1 Vessel has been fitted with Scr
Slide 12: Shipping Market
MARKET SHIPPING
Slide 13: IMO Regulations on Ballast Water Treatment System
IMO REGULATIONS ON BALLAST WATER TREATMENT SYTEM What is Ballast Water Treatment System(BWTS) IMO regulations? 1. Ballast water has to be taken onboard by ships for stability and can contain thousands of aquatic or marine microbes, plants and animals, which are then carried across the globe. Untreat
Slide 14: IMO 2020
IMO 2020 What is IMO 2020? 1) The International Maritime Organization (IMO) will require shipowners to reduce sulfur emissions from 3.5% currently to 0.5% starting 1st January, 2020. 2) There are two options for shipowners to comply with IMO 2020 sulfur regulations: • Installing a scrubber to enable
Slide 15: IMO 2020
IMO 2020 Type of Fuel Sulfur Content Composition 2020 Possible issues post 2020 Low Availability, Fuel oil from Scrubber HSFO 3.5% refinery Installed Vessels Higher CAPEX for scrubbers Allowed Diesel from the MGO 0.1% refinery including ECA Expensive Areas Blends HSFO with a straight Allowed in Non-
Slide 16: Key Points on Tanker Market
KEY POINTS ON TANKER MARKET Asset •VLCC 5 yr old asset prices increased about 11% Y-O-Y* Prices •Suezmax 5 yr old asset prices increased about 11% Y-O-Y* Freight Rates •BCTI fell by 24% & BDTI were flat during Q2CY19 sequentially •U. S. production is up about 1.5 million barrels a day year-on-year,
Slide 17: Tankers – Asset Price Movement (5-Year Old)
TANKERS – ASSET PRICE MOVEMENT (5-YEAR OLD) VLCC Suezmax Aframax VLCC Suezmax Aframax 180 80 160 70 140 60 Ship Price (in million $) Ship Price (in million $) 120 50 100 40 80 60 30 40 20 20 10 0 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2017 2017 2018 2018 2018 2018 2019 2019 Wet Bulk asset prices has improved by
Slide 18: Baltic Dirty & Clean Index
400 500 600 700 800 900 1,000 1,100 1,200 1,300 Aug-14 Nov-14 Feb-15 May-15 Aug-15 Nov-15 Feb-16 May-16 Source – Industry Reports Aug-16 Nov-16 Feb-17 May-17 Aug-17 Nov-17 Feb-18 BALTIC DIRTY TANKER INDEX May-18 Aug-18 Nov-18 Feb-19 May-19 Aug-19 300 400 500 600 700 800 900 1,000 Aug-14 Nov-14 Feb-1
Slide 19: Total Oil Supply & Demand
TOTAL OIL SUPPLY & DEMAND Supply Demand Refinery Throughput (RHS) 103 84 101 82 million barrels per day million barrels per day 99 97 80 95 78 93 91 76 89 74 87 85 72 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2014 2015 2016 2017 2018 2017 2017 2017 2017 2018 2018 2018 2018 2019 2019 In Q2CY19, refining throughp
Slide 20: Crude & Product Growth
CRUDE & PRODUCT GROWTH • Crude demand growth was marginally negative at approx. 0.4 Mn barrels a day in Q2CY2019 Y-O-Y • Core refined products demand growth was marginally negative at approx. 0.2 Mn barrels a day largely due to industrial slowdown and feedstock petchem demand switch to LPG. 5 20 Sou
Slide 21: Refinery Margins
REFINERY MARGINS Refining Margins were negatively impacted in Asia by extremely weak light distillate cracks due to addition of new gasoline oriented capacity whereas Atlantic basin had relatively stable margins. 5 21 Source – Industry Reports
Slide 22: Crude Oil Imports (US & China)
CRUDE OIL IMPORTS (US & China) 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 9,000 11,500 10,500 8,500 China Crude Oil total Imports (‘000 bpd) US Crude Oil total Imports (‘000 bpd) 9,500 8,000 8,500 7,500 7,500 6,500 7,000 5,500 4,500 6,500 3,500 Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov
Slide 23: Crude Oil Exports (US)
CRUDE OIL EXPORTS (US) 2019 2018 2017 2016 2015 3,500 US Crude Oil total Exports (‘000 bpd) 3,000 2,500 2,000 1,500 1,000 500 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec In Q2CY2019, US exported 36% higher crude oil than Q2CY2018 23
Slide 24: US LPG Exports of Propane & Propylene
US LPG EXPORTS OF PROPANE & PROPYLENE US LPG Exports of Propane & Propylene (y-o-y growth in %) 70% 60% 50% 40% 30% 20% 10% 0% -10% -20% Q1FY14 Q2FY14 Q3FY14 Q4FY14 Q1FY15 Q2FY15 Q3FY15 Q4FY15 Q1FY16 Q2FY16 Q3FY16 Q4FY16 Q1FY17 Q2FY17 Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 In Q2CY20
Slide 25: World Fleet Growth Crude Tankers
WORLD FLEET GROWTH CRUDE TANKERS Tanker Fleet - mn Dwt 30-Jul-19 1-Jan-19 1-Jan-18 1-Jan-17 1-Jan-16 VLCC 238.50 233.34 225.10 213.80 200.00 Suezmax 85.40 81.86 80.60 74.60 71.09 Aframax 69.80 67.07 67.20 66.40 64.37 Total (80k+)* 399.51 381.70 378.90 355.00 335.46 Order Book (mn Dwt) 2019 2020 2021
Slide 26: World Fleet Growth Product Tankers & VLGC
WORLD FLEET GROWTH PRODUCT TANKERS & VLGC Product Fleet - mn Dwt 30-Jul-19 1-Jan-19 1-Jan-18 1-Jan-17 LR2 40.75 37.9 36.60 33.50 LR1 27.42 26.9 26.51 25.20 MR/Handy (35k+) 85.55 83.3 82.40 80.40 Total (35k+)* 157.03 150.93 147.61 139.40 Order Book(mn Dwt) 2019 2020 2021+ Total Orderbook as % of curr
Slide 27: Key Points on Dry Bulk Markets
KEY POINTS ON DRY BULK MARKETS Asset • Capesize 5 yr old asset prices were down 16% in Q2CY2019 Y-O-Y Prices • Panamax & Supramax 5 yr old asset prices were flat in Q2CY2019 Y-O-Y Freight • BDI hits 2,191 on 22-Jul-19 due to commencement of Brucutu mines production and Rates announcement on partial
Slide 28: Bulker Asset Prices 5-Year Old
BULKER ASSET PRICES 5-YEAR OLD Capesize Panamax Supramax Capesize Panamax Supramax 180 40 160 35 140 30 Ship Price (in million $) Ship Price (in million $) 120 25 100 80 20 60 15 40 10 20 5 0 0 2004-Jul 2005-Jul 2006-Jul 2007-Jul 2008-Jul 2009-Jul 2010-Jul 2011-Jul 2012-Jul 2013-Jul 2014-Jul 2015-Ju
Slide 29: Baltic Dry Index
BALTIC DRY INDEX 2,250 Vale’s Dam 2,050 Incident 1,850 1,650 1,450 1,250 1,050 850 650 450 250 Aug-14 Aug-15 Aug-16 Aug-17 Aug-18 Aug-19 Nov-14 Nov-15 Nov-16 Nov-17 Nov-18 May-15 May-16 May-17 May-18 May-19 Feb-15 Feb-16 Feb-17 Feb-18 Feb-19 Baltic Dry Index hit 5.5 year high of 2,191 in Jul’19 afte
Slide 30: China Iron Ore & Steel Production
CHINA IRON ORE & STEEL PRODUCTION World Steel China Steel % Growth World % Growth China 2000 16% 1800 14% Steel Production (in Million tonnes) 1600 12% 1400 10% 1200 8% 1000 6% China Steel Production 800 4% increased 10% in 600 2% H1CY2019 Y-O-Y 400 0% 200 -2% 0 -4% 2013 2014 2015 2016 2017 2018 1H2
Slide 31: China Coal Imports
-15.0 -10.0 0.0 5.0 -5.0 10.0 15.0 Mn Tonnes Jan-17 Feb-17 Mar-17 Apr-17 Source – Industry Reports May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 CHINA COAL IMPORTS Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 China coal imports change (Y-O-Y) Nov-18 Dec-18 Jan-19 F
Slide 32: World Fleet Growth Dry Bulk
WORLD FLEET GROWTH DRY BULK Fleet - Mn Dwt 30-Jul-19 1-Jan-19 1-Jan-18 1-Jan-17 Capesize 340 335 324 315 Panamax 213 207 202 196 Handymax 204 201 196 189 Handysize 102 98 96 94 Total 860 841 818 794 Orderbook 2019 2020 2021 2022+ Total (mn Dwt) Orderbook 3.0% 5.6% 2.1% 0.3% 11.0% (%Fleet) Slippage A
Slide 33: Scrapping
SCRAPPING Fleet Vessel (mn Dwt) Scrapping (% of beginning world fleet) Category 30 Jul 19 H1CY2019 2018 2017 2016 2015 2014 Crude 399.51 0.57% 4.62% 2.35% 0.35% 0.23% 1.60% Product 157.03 0.23% 1.64% 1.42% 0.62% 0.61% 1.19% Dry Bulk 860.00 0.54% 0.54% 1.77% 3.67% 4.03% 2.25% Moderately higher for Dr
Slide 34: Greatship (India) Limited
Greatship (India) Limited (a 100% subsidiary)
Slide 35: Offshore Business Fleet Profile
OFFSHORE BUSINESS FLEET PROFILE Fleet Utilization Current Owned Fleet Extent of coverage of Fleet Count Type Category fleet's operating days (FY20) Jack Up Rigs (350ft) 4 PSV 52% Platform Supply Vessels (PSV) 4 Anchor Handling Tug cum ROVSV 85% 8 Supply Vessels (AHTSV) AHTSV 88% Multipurpose Platfor
Slide 36: Key Points on E&P Markets
KEY POINTS ON E&P MARKETS Q2 CY2019 Day Rates • Charter rates and utilization have started to pickup form the lows in certain geographies Fleet • Rigs: Total fleet remains broadly same compared to last quarter and over one year. Growth • OSV’s: Total fleet remains broadly same compared to last quart
Slide 37: Offshore E&P Spending
OFFSHORE E&P SPENDING According to various industry reports, after the sharp fall over last 3 years, the E&P spending declined marginally in 2018 and is expected to either stabilize or increase marginally in 2019. Source – Industry Reports 37
Slide 38: Global Fleet Supply Offshore
GLOBAL FLEET SUPPLY OFFSHORE Fleet & Orderbook Number Jackup Rigs AHTSVs PSV Current Fleet 518 2005 1621 Orderbook 63 74 127 O/B to current fleet 14.0% 4.0% 9.0% • YTD CY2019 actual deliveries have been far lower than scheduled. Due to bleak employment scenario owners have refrained from taking deli
Slide 39: Financial Results Q1 FY 2019-20
FINANCIAL RESULTS Q1 FY 2019-20 39
Slide 40: Financial Highlights
FINANCIAL HIGHLIGHTS GE Shipping Q1FY20 consolidated Net Loss at Rs. 53.96 Crores Standalone Key Figures Consolidated Q1FY20 Q1FY19 (Amount in Rs. Crs) Q1FY20 Q1FY19 Income Statement 631.12 604.25 Revenue (including other income) 833.22 844.37 164.88 (14.13) EBITDA (including other income) 261.00 84
Slide 41: Financial Highlights
FINANCIAL HIGHLIGHTS Standalone Key Figures Consolidated Q1FY20 Q1FY19 Q1FY20 Q1FY19 Key financial figures 26.12% -2.34% EBITDA Margin 31.32% 10.01% 4.67% 0.56% *#Return on Equity (ROE) 2.70% 3.65% 6.04% 4.19% *#Return on Capital Employed (ROCE) 4.72% 5.78% 0.81 0.90 Gross Debt/Equity Ratio 0.88 0.9
Slide 42: Financial Highlights
FINANCIAL HIGHLIGHTS Breakup of Revenue Days Revenue Days Q1 FY20 Q1 FY19 Owned Tonnage 4,142 4,190 Inchartered Tonnage 35 56 Total Revenue Days 4,177 4.246 Total Owned Tonnage (mn.dwt) 3.85 3.97 Average TCY Details Mix of Spot & Time Average (TCY $ per day) Q1’FY20 Q1’FY19 % Change Days (in %) Q1’F
Slide 43: Thank You
THANK YOU THANK YOU visit us at www.greatship.com 43
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