Great Eastern Shipping Co. Ltd. · NSE:GESHIP
Great Eastern Shipping — The Great Eastern Shipping — Investor Presentation (March 2008)
29 slides from Great Eastern Shipping's investor presentation, March 2008
Slide 1: Business & Financial Review March 2008
The Great Eastern Shipping Co. Ltd. Business & Financial Review March 2008 1
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 Co. Ltd. Incorporated in 1948 Shipping Business Offshore Business Wet bulk Through wholly owned subsidiary Greatship (India) Limited Product Tankers Offshore oil field Support & Crude Tankers (includes LPG) Logistics Services Dry bulk 3
Slide 4: Company at a glance
Company at a glance $ India’s largest private sector Shipping Company $ In its 60th year of operations $ Diverse asset base with global operations $ 25 years of uninterrupted dividend track record $ Rated ‘AAA’ (Domestic Currency Debt) since 1996 $ High liquidity; adequate floating stock Shareholdin
Slide 5: Asset Profile Shipping business
Asset Profile Shipping business 46 ships aggregating 3.07 Mn dwt, avg.age 10.4 years 33 Tankers avg.age 9.5 years (77% in tonnage terms) 12 Crude oil carriers (6 Suezmax, 6 Aframax) avg.age 7.5 years ( 2 single hull) 19 Product tankers (1 Panamax ,11 MR, 7 GP) avg.age 12.7 years (10 single h
Slide 6: Committed CAPEX – Shipping Business
Committed CAPEX – Shipping Business Committed Capex of around USD 589 Mn - 12 new building contracts aggregating 0.85 mn. dwt 9FY 2009 - 2 NB, LR 1 Product Tankers (Q2) 9FY 2010 - 2 NB, LR 1 Product Tankers (Q3) - 2 NB, Supramax Dry Bulk Carriers (Q4) 9FY 2011 - 1 NB, Kamsarmax Dry Bulk Carrier (Q4)
Slide 7: Business Philosophy
Business Philosophy Strive to deliver through the cycle Risk Management Mechanism Revenue Cost Asset -Mix of Spot v/s Time -Bunker Hedging -Timing acquisitions & sales -FX Hedging -Interest Rates 7
Slide 8: Financial Review
Financial Review 8
Slide 9: Performing through the years
Performing through the years. . . 70.0 3.5 3.02 2.92 3.26 Avg Cash Profits for the last 7 years: Rs. 744 crs 60.0 58.0 3 2.47 55.1 50.0 2.5 42.3 Rs/ Share 40.0 2 mn dwt 1.32 1.37 1.28 30.0 1.5 24.3 20.0 1 11.4 11.2 11.5 8.0 8.8 9.0 10.0 6.5 0.5 2.8 4.0 4.0 0.0 0 2000-01 2001-02 2002-03 2003-04 2004-
Slide 10: Performing through the years
Performing through the years. . . 450 50 405 43.80 45 400 Avg ROE for the last 7 years: 29% 40.60 350 34.80 40 335 282 35 300 32.40 Rs. Per share 30 250 % 19.50 201 25 200 17.48 15.96 157 20 139 150 115 15 100 84 67 67 79 10 53 62 50 50 5 0 0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06* 2006-07
Slide 11: Movement of Share Price v/s NAV
Movement of Share Price v/s NAV 600 557 540 NAV Sh.Price 492 500 452 401 405 400 351 345 333 304 303 (Rs) 300 282 261 225 198 201 200 162 139 154 127 96 100 80 84 81 67 31 27 38 - 2 3 4 5 6 7 7 2 3 4 5 6 7 7 n'0 '0 '0 '0 '0 '0 '0 p'0 p'0 p'0 p'0 p'0 p'0 c '0 ar ar ar ar ar ar Ju Se Se Se Se Se Se De
Slide 12: Financial Highlights of Q3 FY08 performance
Financial Highlights of Q3 FY08 performance 9mths 9mths (Rs.crs) Q3 FY08 Q3 FY07 % change % change FY08 FY07 Income from Operations 604 490 23% 1842 1446 27% Operating Profit 290 224 29% 881 722 22% Operating Margin 48% 45% 48% 49% PAT (excl. AS 11 impact) 272 165 64% 885 642 37% Cash Profit* 359 22
Slide 13: Earnings Mix
Earnings Mix Mix of Spot & Time GE Shipping Average TCY Details – Q3 FY08 Days Q3 FY08 Q3 FY07 Dry Bulk Q3 Q3 % Spot % 57% 54% AverageTCY ($ per day) FY08 FY07 change Time % 43% 46% Tankers Crude Carriers 23,564 29,768 -21% Spot % 30% 33% Product Carriers 19,512 19,611 -1% Time % 70% 67% Total Gas C
Slide 14: Ship prices continue to be firm
Ship prices continue to be firm Asset Price Movement (5 yr old) 160 160 140 140 $ USD mn. $ USD mn. 120 120 100 100 80 80 60 60 40 40 20 20 0 Dr y bul k 0 16/09/2003 T anke r s Time line- Sep 2003 till Mar 25, 2008 VLCC AFRAMAX CAPESIZE PANAMAX(DRY) Source: Baltic Sale & Purchase Assessment 14
Slide 15: Shipping Industry Outlook
Shipping Industry Outlook 15
Slide 16: Global Oil consumption-growth forecast
Global Oil consumption-growth forecast 16
Slide 17: US Inventory level at lows
US Inventory level at lows Source: EIA, 25 Jan’08 17
Slide 18: Outlook for Crude Tankers
Outlook for Crude Tankers Short Term : o High volatility expected as there is tightness in supply/demand o Number of tankers going out on a/c of conversions/FPSO’s etc is key o Lower levels of inventory as compared to CY07 Long Term : o Stricter compliance to IMO deadline o Quantum of conversions ca
Slide 19: Outlook for Product Tankers
Outlook for Product Tankers Longer term structural shift of trade patterns to continue - Refining capacity to grow in the Mid East/India/Far East Increased long haul activity for distillate trades (Jetfuel, Diesel,Gasoil) - as net deficit in western markets is growing Significant demand for pe
Slide 20: Outlook of Dry Bulk Market
Outlook of Dry Bulk Market Short Term : Uncertainty to prevail till Iron ore price negotiations final Normalising of port problems / capacities Long Term : Demand for raw material for infrastructure growth in India & China Aging fleet due to low level of scrapping Risks: High order book posi
Slide 21: Dry Bulk – Growth Driven by Asia
Dry Bulk – Growth Driven by Asia Breakup of commodities transported Imports - Regional Distribution Others 4% N.America Iron Ore 4% M.East 27% 4% Africa S.America 4% Minor 3% Others Bulk 2% 33% Europe 24% Asia Coal 59% Grains 26% 10% Asia contributes to 59% of dry bulk imports, whereas North America
Slide 22: Offshore Business
a Offshore Business 22
Slide 23: Asset Profile Offshore business - Greatship (India) Limited
Asset Profile Offshore business - Greatship (India) Limited & its subsidiary companies ¾ Current Fleet 9 3 Platform Supply Vessels (PSV) 9 1 Anchor Handling Tug cum Supply Vessel (AHTSV) Fleet Growth FY2008 FY2009 FY2010 FY2011 Fleet ( in nos) 4 10 20 22 Average Age (yrs) 3.3 2.3 1.5 2.2 23
Slide 24: Committed CAPEX – Offshore Business
Committed CAPEX – Offshore Business ¾ Committed Capex of around USD 667 Mn* 9 FY 2009 - 1 NB 80T AHTSV (CDL) (Q1) - 2 NB PSVs (Aker) delivery (Q2 & Q3) - 2 NB 80T AHTSVs (Labroy) (Q4) - 1 NB 80T AHTSV (CDL) (Q4) 9 FY 2010 - 2 NB 80T AHTSV (CDL, Labroy) (Q1) - 1 NB 80T AHTSV (Labroy) (Q2) - 4 NB MPSV
Slide 25: Committed Capex for the Group
Committed Capex for the Group Committed Equity Participation of Rs.850 crs G E Shipping Greatship (India) Ltd (Committed CAPEX (Committed CAPEX USD 589 mn) USD 667 mn) Already infused Rs.592 crs Total committed CAPEX of USD 1.26 bn Spread over next two & half years To be financed with a mix of debt
Slide 26: Outlook on Offshore Industry
Outlook on Offshore Industry 9 Under-investment in global E&P in the past 9 Structural change in demand 9 No commercially viable alternatives 9 Shift from International oil companies to National oil companies 9 Numerous new countries exploring 9 Oil/Gas discoveries moving towards deeper waters Conce
Slide 27: Offshore Supply Market
Offshore Supply Market OSV Fleet Summary (Nos) AHTSVs PSVs Others Current Fleet* 2,138 1,566 1,587 Orderbook 504 241 197 Aging Fleet % of O/B to current fleet 23.6% 15.4% 12.4% 9 52% of the total fleet * Data as on Feb’08, Source: Clarkson over 25 years old Offshore Installations Delivery Schedule T
Slide 28: Business Strategy
Business Strategy Entry Strategy 9 Shallow water supply & towage Growth Strategy 9 Support to Deepwater and Construction Special Area 9 Supporting deepwater activities in ECI Approach Build strong understanding of markets and customers Acquire assets based on customer requirements Develop USP
Slide 29: THANK YOU
THANK YOU visit us at www.greatship.com 29
The Great Eastern Shipping — Investor Presentation (March 2008) on 6ix