Great Eastern Shipping Co. Ltd. · NSE:GESHIP
Great Eastern Shipping — The Great Eastern Shipping — Q3 FY2023 Earnings Presentation
43 slides from Great Eastern Shipping's earnings presentation, Feb 1, 2023
Slide 1: Q3 & 9M FY23 Earnings Presentation
Q3 & 9M FY23 Earnings Presentation 01 February 2023
Slide 2: 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 3: 9MFY23 Highlights
9MFY23 HIGHLIGHTS • Highest ever 9 months net profit of INR 1853 cr on a consolidated basis • First time ever our consolidated NAV has crossed INR 1000/share • Highest ever dividend announced of INR19.80/share GE Shipping – Q3 & 9MFY23 Results 3
Slide 4: Reported Highlights
REPORTED HIGHLIGHTS St an d al on e Con s l i d at e d • GE Shipping 9MFY23 consolidated Net Profit at Q3 Q3 9M Q3 Q3 9M INR 1,853 Cr Fig in INR Crores FY23 FY22 FY23 FY23 FY22 FY23 • Declared 3rd interim In come Stat e me n t dividend of INR 7.20/Share Revenue* 1,261 774 3,828 1,522 932 4,620 EBITD
Slide 5: 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 6: Normalised Financial Highlights
NORMALISED FINANCIAL HIGHLIGHTS Standalone Conslidated • GE Shipping 9MFY23 consolidated Net Profit Q3 Q3 9M Q3 Q3 9M at INR 1,883 Cr Fig in INR Crores FY23 FY22 FY23 FY23 FY22 FY23 • Declared 3rd interim In come State me nt dividend of INR Revenue* 1,261 774 3,828 1,522 932 4,620 7.20/Share for FY2
Slide 7: Normalised Financial Highlights
NORMALISED FINANCIAL HIGHLIGHTS Standalone Conslidated Q3 Q3 9M Q3 Q3 9M FY23 FY22 FY23 FY23 FY22 FY23 Key Fi nancial Figure Return on Equity (ROE%)** 32% 14% 32% 27% 8% 28% Return on Capital Employed (ROCE%)** 23% 10% 22% 20% 6% 20% Gross Debt/Equity (x) 0.46 0.59 0.46 0.50 0.63 0.50 Net Debt/Equit
Slide 8: 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 47.62 45 45.03 57.95 55.65 42.38 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 18.01 24.96 14.79 23.34
Slide 9: Consistent Dividend Payouts
CONSISTENT DIVIDEND PAYOUTS 25 19.8 20 15 13.5 15.0 11.5 11.0 10.0 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 8.0 5.4 3.1 4.0 5 4.0 4.0 3.3 3.0 2.4 2.3 2.3 2.8 2.0 2.0 1.5 0 Dividend Per Share (INR/Share) GE Shipping – Q3 & 9MFY23 Results 9
Slide 10: Profit & Loss Statement – Industry Format
PROFIT & LOSS STATEMENT – INDUSTRY FORMAT Standalone Conslidated Q3 Q3 9M Q3 Q3 9M Figures in INR Crores FY23 FY22 FY23 FY23 FY22 FY23 Operating Revenue 1,207 753 3,603 1,415 932 4,214 Less: Direct Operating Expenses/Voyage Expenses 219 186 852 236 194 881 Time C har ter Equiv alent ( A) 988 567 2,7
Slide 11: Shareholding Pattern
SHAREHOLDING PATTERN FII/FPI 25% Promoters 30% Govt./FI/Corp 19% Public 26% 31-DECEMBER-2022 GE Shipping – Q3 & 9MFY23 Results 11
Slide 12: Management Commentary
MANAGEMENT COMMENTARY Mr. Bharat K Sheth Deputy Chairman & Managing Director “The Company has declared its highest ever quarterly profit if we remove the effect of the profit on sale booked in Q2 FY23. The Company has also reached its highest ever Consolidated NAV of Rs 1048. This rise is due to bot
Slide 13: Performance Review
PERFORMANCE REVIEW Breakup of Revenue Days (Shipping) Q3 Q3 Revenue Days FY23 FY22 Owned Tonnage 3,684 3,993 Inchartered Tonnage 94 28 Total Revenue Days 3,778 4,021 Total Owned Tonnage (mn.dwt) 3.44 3.57 Breakup of Revenue Days (Offshore) Q3 Q3 Revenue Days FY23 FY22 Offshore Logistics 1,507 1,498
Slide 14: Performance Review
PERFORMANCE REVIEW Avg TCYs in Various Categories Q3 Q2 QoQ Q3 YOY Avg (TCYs USD/Day) FY23 FY23 % FY22 % Crude Carriers 60,143 33,076 82% 12,098 397% Product Carriers 36,423 35,691 2% 10,689 241% LPG Carriers 29,803 31,235 -5% 28,609 4% Dry Bulk 17,020 21,882 -22% 31,003 -45% GE Shipping – Q3 & 9MFY
Slide 15: Changes in Standalone NAV (YTD)
CHANGES IN STANDALONE NAV (YTD) INR/SHARE GE Shipping – Q3 & 9MFY23 Results 15
Slide 16: Years Movement in Standalone NAV
5 YEARS MOVEMENT IN STANDALONE NAV Standalone NAV – Continue to touch new highs 1000 892 900 CAGR: 18% 800 INR/SHARE 700 600 500 337 400 300 200 100 0 FY17 FY18 FY19 FY20 FY21 FY22 9MFY23 GE Shipping – Q3 & 9MFY23 Results 16
Slide 17: Changes in Consolidated NAV (YTD)
CHANGES IN CONSOLIDATED NAV (YTD) INR/SHARE GE Shipping – Q3 & 9MFY23 Results 17
Slide 18: Revenue Coverage
REVENUE COVERAGE Coverage of Operating Days (Shipping) Q4 Category FY23 Crude Carriers 50% Product Carriers 45% LPG Carriers 100% Dry Bulk 65% Coverage of Operating Days (Off-Shore) Q4 Revenue Days FY23 Jack Up Rigs 99% AHTSV 93% MPSVV 87% PSV/ROVSV 84% GE Shipping – Q3 & 9MFY23 Results 18
Slide 19: Standalone Debt Repayment Schedule
STANDALONE DEBT REPAYMENT SCHEDULE GESCO Standalone (USD mn) 90 500 80 81 80 74 450 70 444 400 350 60 49 51 300 50 250 40 200 30 150 20 100 10 50 0 0 Dec-22 Mar-23 Mar-24 Mar-25 Mar-26 Mar-27 Loan Repayments Loan O/S (RHS) 1) Prepaid USD 45 Mn of debt in 9MFY23. 2) Of the USD 49 Mn payable in Q4FY23
Slide 20: Fleet Profile
FLEET PROFILE Fleet Profile - Shipping DWT Fleet (1 Feb'23) Fleet FY23 No Avg Age Crude Carriers 947,968 7 14.73 Product Carriers 1,092,465 18 14.89 Gas Carriers 185,363 4 17.21 Dry Bulk Carriers 1,210,805 14 9.81 Total 3,436,601 43 13.18 Fleet Profile - Offshore Avg Years Fleet No. of Units Yrs. Ja
Slide 21: Shipping Market
N ‘The Great Eastern \ Shipping Co. Ltd. \ SHIPPING MARKET THE GREAR SHIPPING
Slide 22: 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 23: Crude and Product Tankers
CRUDE AND PRODUCT TANKERS • Spot Earnings for the quarter reached a high since the war broke out in Feb 2022 • Asset prices trending upwards - Strongest since 2009 • Strong crude ton-miles growth in Cal22 significantly tightened the market • EU embargo resulted in trade dislocation - Long Haul Trade
Slide 24: Dry Bulk
DRY BULK DB Freight softened in 9MFY23 Y-O-Y, while Capes hovered at low end, 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
Slide 25: Dry Bulk
DRY BULK • Spot earnings remain soft - Half of last year’s level in Q3 • Asset prices fell inline with earnings - Corrected 20% from peak levels • Global steel production was down 4% y/y in CY 2022. • China new property starts were down 40% y/y in CY 2022. • Ukraine grain exports were down 55% y/y i
Slide 26: LPG Gas
LPG GAS Avg. VLGC Earnings (USD/day) VLGC Spot earnings sustained healthy levels during 9M FY- 130,000 23 and were much higher YoY in comparison to 9M FY-22. 110,000 90,000 USD/day FY22 FY23 % change 70,000 9M 32,821 61,484 87% 50,000 30,000 10,000 April May June July Aug Sep Oct Nov Dec Jan Feb Mar
Slide 27: Fleet Supply
me ‘ oF - x , a “ A Ete Great tasers yal = \ Shipping Co. Ltd. 3 i& FLEET SUPPLY THE GREAT: EASTERN SHIRPING .COLTD.
Slide 28: Lowest Order Book to Fleet Ratio
LOWEST ORDER BOOK TO FLEET RATIO Historic Order Book as a % of fleet (Calendar Year) 90% 80% 70% 60% 50% 40% Current Orderbook 30% 4.80% 20% 3.60% 7.40% 10% 0% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Crude Tankers Produc
Slide 29: Asset Price Movement
N The Great Eastern \ Shipping Co. Ltd. \ ASSET PRICE MOVEMENT THE GREAT EASTERN SHIPPING CO. LTD.
Slide 30: Asset Price Movement (Indexed Over Last 5 Yrs)
75 85 95 105 115 125 135 145 90 100 110 120 130 140 150 160 170 Jan-18 Jan-18 Apr-18 Apr-18 Jul-18 Jul-18 Oct-18 Oct-18 Jan-19 Jan-19 Sources: Industry Reports Apr-19 Apr-19 GE Shipping – Q3 & 9MFY23 Results Jul-19 Jul-19 Oct-19 Oct-19 Jan-20 Jan-20 Apr-20 Apr-20 Jul-20 Jul-20 Suezmax Capesize Oct-2
Slide 31: Scrapping
SCRAPPING Fleet (Mn Dwt) Vessel Category Jan'23 Crude 452 Product 181 Dry Bulk 972 Scrapping (% Beginning world fleet) CY CY CY CY CY CY CY CY CY Vessel Category 2022 2021 2020 2019 2018 2017 2016 2015 2014 Crude 0.78 2.47 0.53 0.55 4.39 2.43 0.39 0.38 1.75 Product 0.76 2.11 0.57 0.60 1.72 1.22 0.54
Slide 32: Greatship (India) Limited 100% Subsidiary
GREATSHIP (INDIA) LIMITED 100% SUBSIDIARY
Slide 33: Jack Up Rigs - Market
JACK UP RIGS - MARKET Demand Side: • Middle East has been a big driver of incremental demand. Saudi has contracted 38 incremental JUs in 2022. Once these rigs commence contracts, the rig count tied on terms contracts with Saudi Aramco is estimated at reach 85-90 units (~20% of global fleet). • Both
Slide 34: Fleet Supply – Increasing Number of Cold Stacked Rigs
FLEET SUPPLY – INCREASING NUMBER OF COLD STACKED RIGS Number Jack-up Rigs PSV+AHTSV Current Fleet 493 3,472 Under Contract Fleet 358 2,199 Order Book 20 105 O/B to Current Fleet 4.1% 3.0% Total Scrapping since Jan 2016 (Nos) 143 588 No of Vessels/Rigs more than 20/30 years old (% Fleet) 33% 20% Cold
Slide 35: Market Trends: Utilisation
MARKET TRENDS: UTILISATION Total Util % Jack Up Utilisation : Gradual Improvement 450 85 80 400 75 350 70 65 300 60 250 55 200 50 Under Contract Total Util % GE Shipping – Q3 & 9MFY23 Results 35
Slide 36: Repricing
REPRICING Remaining 2 rigs will come up for repricing in FY 26 and FY 27 Vessels Rigs 6 5 4 2 1 1 1 0 0 0 H2 FY23 H1 FY24 H2 FY24 H1 FY25 H2 FY25 GE Shipping – Q3 & 9MFY23 Results 36
Slide 37: Debt Repayment Schedule
DEBT REPAYMENT SCHEDULE GIL (USD Mn) 120 160 140 100 97 140 120 80 100 60 80 60 40 36 40 20 20 7 0 0 Dec-22 Mar-23 Mar-24 Mar-25 Repayments Loan O/S (RHS) GE Shipping – Q3 & 9MFY23 Results 37
Slide 38: Financials
The Great Eastern Shipping Co. Ltd. FINANCIALS
Slide 39: 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 0.60 350 0.50 300 0.40 250 200 0.30 150 0.20 100 0.10 50 - - -50 -0.10 -100 -0.20 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 9MFY2023 Net Debt Net Debt to Equity GE Shipping –
Slide 40: Share Price to Consolidated NAV
SHARE PRICE TO CONSOLIDATED NAV INR/Share 1200 1 0.9 1000 0.8 0.7 800 0.6 600 0.5 0.4 400 0.3 0.2 200 0.1 0 0 FY16 FY17 FY18 FY19 FY20 FY21 FY22 9MFY23 Consolidated NAV Standalone NAV Share Price/Consol. NAV (RHS) * For 9MFY23 we have taken share price as on 31st January 2023 40 GE Shipping – Q3 & 9
Slide 41: Great Eastern CSR Foundation
GREAT EASTERN CSR FOUNDATION GECSRF supports NGOs working under health, education and livelihoods CURRENT PARTNERS EDUCATION HEALTH LIVELIHOODS GE Shipping – Q3 & 9MFY23 Results 41
Slide 42: Initiatives on Environment
INITIATIVES ON ENVIRONMENT • Reduced our annual CO2 emissions by about 40,000 tons between FY2019 and FY2022, by investing in various energy saving technologies. • Created an ESG profile of our company based certain ESG metric. The profile is available on our website under “SUSTAINABILITY” tab • Vol
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 – Q3 & 9MFY23 Results 43
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