Great Eastern Shipping Co. Ltd. · NSE:GESHIP
Great Eastern Shipping — The Great Eastern Shipping — Q4 FY2023 Earnings Presentation
43 slides from Great Eastern Shipping's earnings presentation, May 12, 2023
Slide 1: Cover letter to stock exchanges
Our Ref.: S/2023/JMT May 12, 2023 BSE Limited National Stock Exchange of India Limited 1st Floor, Phiroze Jeejeebhoy Towers, Exchange Plaza, 5th Floor, Plot No. C/1, Dalal Street, Bandra Kurla Complex, Bandra (East), Mumbai – 400 001 Mumbai – 400 051 BSE Scrip code: 500620 Trading Symbol - GESHIP De
Slide 2: Q4 & FY23 Earnings Presentation
Q4 & FY23 Earnings Presentation 12 May 2023
Slide 3: Disclaimer
DISCLAIMER 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, pros
Slide 4: FY23 Highlights
FY23 HIGHLIGHTS • Highest ever net profits of INR 2,575 Cr on a consolidated basis • Our consolidated NAV has moved by 68% in FY23 to INR 1164/share • Highest ever dividend announced for a year of INR 28.80/share GE Shipping – Q4 & FY23 Results 3
Slide 5: Reported Highlights
REPORTED HIGHLIGHTS St an d al on e Con s l i d at e d • GE Shipping FY23 consolidated Net Q4 Q4 Q4 Q4 Profit at INR 2,575 Cr Fig in INR Crores FY23 FY22 FY23 FY22 FY23 FY22 FY23 FY22 • Declared 4th interim In come St at e me n t dividend of INR Revenue* 1,268 740 5,096 2,966 1,551 983 6,171 3,669 E
Slide 6: Normalised Financials
NORMALISED FINANCIALS o The impact of the exchange rate on foreign currency loans and current assets and liabilities, including cash and bank balances, has been removed o NCD & Currency Swap: o Funds raised through NCDs have been swapped into USD using INR-FCY swaps, thus creating synthetic fixed ra
Slide 7: Normalised Financial Highlights
NORMALISED FINANCIAL HIGHLIGHTS Standalone Conslidated • GE Shipping FY23 consolidated Net Profit Q4 Q4 Q4 Q4 at INR 2,581 Cr Fig in INR Crores FY23 FY22 FY23 FY22 FY23 FY22 FY23 FY22 • Declared 4th interim Income State me nt dividend of INR Revenue* 1,268 740 5,096 2,966 1,551 983 6,171 3,669 9.00/
Slide 8: Normalised Financial Highlights
NORMALISED FINANCIAL HIGHLIGHTS Standalone Conslidated Q4 Q4 Q4 Q4 FY23 FY22 FY23 FY22 FY23 FY22 FY23 FY22 Ke y Financial Figure Return on Equity (ROE%)** 32% 11% 32% 12% 28% 10% 28% 8% Return on Capital Employed (ROCE%)** 24% 8% 23% 9% 21% 8% 20% 6% Gross Debt/Equity (x) 0.35 0.59 0.35 0.59 0.40 0.
Slide 9: Normalised Financials – Key Ratios
NORMALISED FINANCIALS – KEY RATIOS Earnings per Share (INR/Share) Cash Profit per Share (INR/Share) Standalone Consolidated Standalone Consolidated 55 51.21 63.89 48.98 47.62 60.71 45 46.34 45.03 57.95 55.65 42.38 53.61 50.61 35.65 48.21 35 32.55 40.55 25 14.30 16.96 27.84 15 9.11 15.36 25.62 24.84
Slide 10: Consistent Dividend Payouts
CONSISTENT DIVIDEND PAYOUTS 35 30 28.8 25 20 15 13.5 11.5 15.0 10.0 11.0 10.1 9.9 10 9.0 9.0 9.0 8.0 8.0 8.1 7.5 7.2 6.5 6.5 3.1 8.0 5.4 4.0 5 4.0 4.0 3.3 2.3 3.0 2.8 2.4 2.3 2.0 0 2.0 1.5 Dividend Per Share (INR/Share) GE Shipping – Q4 & FY23 Results 9
Slide 11: Profit & Loss Statement – Industry Format
PROFIT & LOSS STATEMENT – INDUSTRY FORMAT Standalone Conslidated Q4 Q4 Q4 Q4 Figures in INR Crores FY23 FY22 FY23 FY22 FY23 FY22 FY23 FY22 Operating Revenue 1,206 717 4,809 2,798 1,446 909 5,660 3,472 Less: Direct Operating Expenses/Voyage Expenses 181 201 1,033 723 186 212 1,068 770 Time C har ter
Slide 12: Shareholding Pattern
SHAREHOLDING PATTERN FII/FPI Promoters 26% 30% Govt./FI/Corp 20% Public 24% 31-MARCH-2023 GE Shipping – Q3 & 9MFY23 Results GE Shipping – Q4 & FY23 Results 11
Slide 13: Management Commentary
MANAGEMENT COMMENTARY Mr. Bharat K Sheth Deputy Chairman & Managing Director “The Company continued its strong performance in this quarter as well. The company declared a fourth dividend for the year, making a total of Rs. 28.80 per share for FY 2022-23. Tanker markets continued the strong run that
Slide 14: Performance Review
PERFORMANCE REVIEW Breakup of Revenue Days (Shipping) Q4 Q4 Revenue Days FY23 FY22 Owned Tonnage 3,831 3,939 Inchartered Tonnage 80 59 Total Revenue Days 3,911 3,998 Total Owned Tonnage (mn.dwt) 3.44 3.57 Breakup of Revenue Days (Offshore) Q4 Q4 Revenue Days FY23 FY22 Offshore Logistics 1,447 1,508
Slide 15: Performance Review
PERFORMANCE REVIEW Avg TCYs in Various Categories Q4 Q3 QoQ Q4 YoY Avg (TCYs USD/Day) FY23 FY23 % FY22 % Crude Carriers 64,579 60,143 7% 15,051 329% Product Carriers 36,665 36,423 1% 10,251 258% LPG Carriers 29,175 29,803 -2% 26,107 12% Dry Bulk 12,704 17,020 -25% 22,158 -43% Avg TCYs in Various Cat
Slide 16: Changes in Standalone NAV (YTD)
CHANGES IN STANDALONE NAV (YTD) INR/SHARE GE Shipping – Q4 & FY23 Results 15
Slide 17: Years Movement in Standalone NAV
5 YEARS MOVEMENT IN STANDALONE NAV Standalone NAV – Continue to touch new highs 1200 1000 CAGR: 22% 962 INR/SHARE 800 600 357 400 200 0 FY18 FY19 FY20 FY21 FY22 FY23 GE Shipping – Q4 & FY23 Results 16
Slide 18: Changes in Consolidated NAV (YTD)
CHANGES IN CONSOLIDATED NAV (YTD) INR/SHARE GE Shipping – Q4 & FY23 Results 17
Slide 19: Revenue Coverage
REVENUE COVERAGE Coverage of Operating Days (Shipping) Category FY24 Crude Carriers 15% Product Carriers 17% LPG Carriers 73% Dry Bulk 17% Coverage of Operating Days (Off-Shore) Revenue Days FY24 Jack Up Rigs 93% AHTSV 71% MPSVV 33% PSV/ROVSV 83% GE Shipping – Q4 & FY23 Results 18
Slide 20: Standalone Debt Repayment Schedule
STANDALONE DEBT REPAYMENT SCHEDULE GESCO Standalone (USD mn) 80 74 74 400 70 68 350 368 60 300 50 45 250 40 36 200 30 150 20 100 10 50 0 0 Mar-23 Mar-24 Mar-25 Mar-26 Mar-27 Mar-28 Loan Repayments Loan O/S (RHS) 1) Prepaid USD 72 Mn of debt in FY23. 2) Effective all-in USD cost of debt of about 4.00
Slide 21: Fleet Profile
FLEET PROFILE Fleet Profile - Shipping DWT Fleet (12 May'23) Fleet FY23 No Avg Age Crude Carriers** 947,968 7 15.00 **We have committed to Product Carriers 1,092,465 18 15.16 Gas Carriers 185,363 4 17.49 sell our Aframax Crude Dry Bulk Carriers 1,210,805 14 10.09 Carrier ‘Jag Lavanya’ with Total 3,4
Slide 22: Shipping Market
QL Tie Great Fasten \ Shipping Co. Ltd. SHIPPING MARKET
Slide 23: Crude and Product Tankers
CRUDE AND PRODUCT TANKERS Avg. Suezmax Earnings (USD/day) Avg. MR Earnings (USD/day) 100,000 60,000 90,000 50,000 80,000 70,000 40,000 60,000 50,000 30,000 40,000 20,000 30,000 20,000 10,000 10,000 0 0 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar FY
Slide 24: Crude and Product Tankers
CRUDE AND PRODUCT TANKERS • Crude & product tanker spot earnings remain elevated led by trade disruptions caused by Russia-Ukraine war. • Overall seaborne crude & product trade grew by ~11% & 9% y/y respectively during 4QFY23. • EU’s embargo on Russian imports have further boosted ton-miles growth.
Slide 25: Dry Bulk
DRY BULK DB Freight softened in FY23 Y-O-Y, both Capes & Sub-Capes fell significantly Avg. Baltic Capesize 5T/C Earnings (USD/day) Avg. Baltic Supra BSI-58 10T/C Earnings 70,000 (USD/day) 40000 60,000 35000 50,000 30000 40,000 25000 20000 30,000 15000 20,000 10000 10,000 5000 0 0 Apr May Jun Jul Aug
Slide 26: Dry Bulk
DRY BULK • Spot earnings continued to remain soft during the quarter, despite a ~ 4 % YoY ton – mile growth. • Effective fleet supply increased as all the Covid related congestion seen last year completely reversed. • Asset prices showed marginal improvement during the quarter. • China steel product
Slide 27: LPG Gas
LPG GAS Avg. VLGC Earnings (USD/day) 130,000 VLGC Spot earnings sustained healthy levels during FY-23 110,000 and were much higher YoY in comparison to FY-22. 90,000 70,000 USD/day FY22 FY23 % change 50,000 12M 32,125 63,072 96% 30,000 10,000 April May June July Aug Sep Oct Nov Dec Jan Feb Mar FY 22
Slide 28: Fleet Supply
The Great Fastern Shipping Co. Ltd FLEET SUPPLY
Slide 29: Low Order Book to Fleet Ratio
LOW ORDER BOOK TO FLEET RATIO Historic Order Book as a % of fleet (Calendar Year) 90% 80% 70% 60% 50% 40% 30% Current Orderbook 20% 2.5% 8.0% 10% 6.9% 0% Bulkers Product tankers Crude tankers Sources: Industry Reports GE Shipping – Q4 & FY23 Results 28
Slide 30: Asset Price Movement
ASSET PRICE MOVEMENT THE GREAT EASTERN SHIPPING CO. LTD.
Slide 31: Asset Price Movement (Indexed Over Last 5 Yrs)
75 85 95 90 105 115 125 135 145 155 165 100 110 130 140 150 160 170 120 Apr-18 Apr-18 Jul-18 Jul-18 Oct-18 Oct-18 Jan-19 Jan-19 Apr-19 Apr-19 Sources: Industry Reports Jul-19 Jul-19 Oct-19 Oct-19 Jan-20 Jan-20 Apr-20 Apr-20 Jul-20 Jul-20 Oct-20 Oct-20 Suezmax Capesize Jan-21 Jan-21 Apr-21 Apr-21 Jul
Slide 32: Scrapping
SCRAPPING Fleet (Mn Dwt) Vessel Category Apr'23 Crude 458 Product 182 Dry Bulk 981 Scrapping (% Beginning world fleet) CYTD CY CY CY CY CY CY CY CY Vessel Category 2023 2022 2021 2020 2019 2018 2017 2016 2015 Crude - 0.78 2.47 0.53 0.55 4.39 2.43 0.39 0.38 Product 0.10 0.76 2.11 0.57 0.60 1.72 1.22
Slide 33: Greatship (India) Limited 100% Subsidiary
GREATSHIP (INDIA) LIMITED 100% SUBSIDIARY
Slide 34: Jack Up Rigs - Market
JACK UP RIGS - MARKET Demand Side: • Middle East continues to be a big driver of incremental demand. • The rig count tied on term contracts with Saudi Aramco is estimated to reach 85-90 units (~20% of global fleet) Utilization: • Modern rig utilization (contracted+future contracted) troughed at 60-6
Slide 35: Fleet Supply
FLEET SUPPLY Number Jack-up Rigs PSV+AHTSV Current Fleet 494 3,427 Under Contract Fleet 344 2,260 Order Book 20 91 O/B to Current Fleet 4.0% 3.0% Total Scrapping since Jan 2016 (Nos) 145 629 No of Vessels/Rigs more than 20/30 years old (% Fleet) 33% 21% Cold stacked more than 3 years 43 511 Source:
Slide 36: Market Trends: Utilisation
250 300 400 450 200 350 Apr 2010 Aug 2010 Dec 2010 Apr 2011 Aug 2011 Dec 2011 Apr 2012 Aug 2012 Dec 2012 Apr 2013 Aug 2013 Dec 2013 Apr 2014 Aug 2014 Dec 2014 Apr 2015 Aug 2015 Dec 2015 Apr 2016 Aug 2016 MARKET TRENDS: UTILISATION Under Contract Dec 2016 Apr 2017 Aug 2017 Dec 2017 GE Shipping – Q4 &
Slide 37: Repricing
REPRICING Remaining 2 rigs will come up for repricing in FY 26 and FY 27 Vessels Rigs 6 5 4 1 1 1 0 0 H1 FY24 H2 FY24 H1 FY25 H2 FY25 GE Shipping – Q4 & FY23 Results 36
Slide 38: Debt Repayment Schedule
DEBT REPAYMENT SCHEDULE GIL (USD Mn) 120 140 133 97 120 100 100 80 80 60 60 40 36 40 20 20 0 0 Mar-23 Mar-24 Mar-25 Repayments Loan O/S (RHS) GE Shipping – Q4 & FY23 Results 37
Slide 39: Financials
‘The Great Eastern Shipping Co. Ltd. FINANCIALS
Slide 40: Counter Cyclical Investments Generated Strong Cash Flows
COUNTER CYCLICAL INVESTMENTS GENERATED STRONG CASH FLOWS USD Mn Net Debt Expansion Phase Net Debt Reduction Phase 400 0.60 0.50 300 0.40 200 0.30 100 0.20 0.10 - - -100 -0.10 -200 -0.20 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 Net Debt Net Debt/Equity (RHS) GE Shipping – Q4 & FY23 Res
Slide 41: Share Price to Consolidated NAV
SHARE PRICE TO CONSOLIDATED NAV INR/Share 1400 1 0.9 1200 0.8 1000 0.7 0.6 800 0.5 600 0.4 400 0.3 0.2 200 0.1 0 0 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 Consolidated NAV Standalone NAV Share Price/Consol. NAV (RHS) * For FY23 we have taken share price as on 12st May 2023 GE Shipping – Q4 & FY23 Re
Slide 42: Great Eastern CSR Foundation
GREAT EASTERN CSR FOUNDATION GECSRF supports NGOs working under health, education and livelihoods CURRENT PARTNERS EDUCATION HEALTH LIVELIHOODS GE Shipping – Q4 & FY23 Results 41
Slide 43: Thank You
THANK YOU Visit us at www.greatship.com From a modest beginning… ...to most admired globally 1948 2023 Read the Story of GE Shipping – Coffee Table Book GE Shipping – Q4 & FY23 Results 42
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