Great Eastern Shipping Co. Ltd. · NSE:GESHIP
Great Eastern Shipping — The Great Eastern Shipping — Investor Presentation (December 2016)
31 slides from Great Eastern Shipping's investor presentation, December 2016
Slide 1: The Great Eastern Shipping Co. Ltd. Business & Financial Review
The Great Eastern Shipping Co. Ltd. Business & Financial Review December 2016
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 Bulk Logistics Drilling - Products India’s largest private sector shipping company. Over 68 years of experience 3
Slide 4: Shareholding Pattern
Shareholding Pattern Shareholding Pattern as on September 30, 2016 FII 24% Promoters 30% Govt/FI 19% Public Corporate 21% Bodies 6% 4
Slide 5: Shipping business - owned fleet
Shipping business - owned fleet Sr. No. Vessel Name Type Sr. No. Vessel Name Type 1 Jag Lalit Suezmax 23 Jag Vishnu VLGC 2 Jag Lok Suezmax 24 Jag Vidhi VLGC 3 Jag Lateef Suezmax 2 Gas Carriers; Age - 21 years 4 Jag Lakshita Suezmax 25 Jag Anand Capesize 5 Jag Lyall Aframax 26 Jag Aarati Kamsarmax 6
Slide 6: Vessels on Order & Capital Expenditure
Vessels on Order & Capital Expenditure Committed Capex - ~$86 Mn Payable as on Dec-2016 - ~$68 Mn Vessels on Committed Order & Expected Delivery Vessel Yard Expected Delivery 2 Aframax Crude Hyundai Heavy Ind. Carriers (5 year old) (Ulsan), South Korea Q3/Q4FY17 Jiangsu New Yangzi 1 Kamsarmax Dry Bu
Slide 7: Key points on Tanker Markets – Q3FY16
Key points on Tanker Markets – Q3FY16 Asset Prices: -VLCC 5 yr old prices have gone down by 25% in Y-O-Y Q32016 Freight rates: -BDTI almost doubled since August 2016 & BCTI up around 50% from lows of 346 in October 2016 to 505 in December 2016 Crude Market: -Crude oil supply increased due to record
Slide 8: Tankers – Asset Price movement (5-year old)
Tankers – Asset Price movement (5-year old) USD USD mn VLCC Suezmax Aframax mn VLCC Suezmax Aframax 180 90 80 160 70 60 140 50 40 120 30 100 20 10 80 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 60 2015 2015 2015 2015 2016 2016 2016 40 20 0 2001-Dec 2002-Dec 2003-Dec 2004-Dec 2005-Dec 2006-Dec 2007-Dec 2008-Dec 2009-Dec
Slide 9: Recovery of BDTI & BCTI
Recovery of BDTI & BCTI Baltic Dirty Tanker Index Baltic Clean Tanker Index 1,400 1,000 1,300 900 1,200 1,100 800 1,000 700 900 800 600 700 500 600 500 400 400 300 Source – Industry Reports 9
Slide 10: Supply - driven Demand ahead of potential OPEC Cut
Supply - driven Demand ahead of potential OPEC Cut Mbpd Supply Demand Refinery Throughput (RHS) 99 81 97 80 79 95 78 93 77 91 76 89 75 74 87 73 85 72 2012 2013 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2014 2014 2014 2015 2015 2015 2015 2016 2016 2016 • In Q3CY16, Crude tankers rates improved due to inc
Slide 11: Low margins leading to low refinery throughput
Low margins leading to low refinery throughput WTI USG Refinery Margins ($/bbl) VLCCs in floating storage 2014 2015 5-yr Median 2016 Iran AG (excl. Iran) Sing-indo Far East Others 40 75 35 60 30 25 45 20 30 15 10 15 5 0 Nov Apr May Aug Apr May Aug Mar Jun Jul Oct Mar Jun Jul Oct Dec Feb Sep Feb Sep
Slide 12: CY2016 has seen higher imports due to low oil price
CY2016 has seen higher imports due to low oil price US Crude Oil Imports (‘000 bpd) China Crude Oil Imports (‘000 bpd) 2013 2014 2015 2016 2013 2014 2015 2016 9000 8,500 8,000 8500 7,500 8000 7,000 6,500 7500 6,000 5,500 7000 5,000 6500 4,500 Source – Industry Reports 12
Slide 13: World Fleet Growth – Crude Tankers
World Fleet Growth – Crude Tankers Tanker Fleet - mn Dwt 11th Nov 2016 1st Jan 2016 1st Jan 2015 1st Jan 2014 VLCC 211.86 200.00 193.75 186.13 Suezmax 74.69 71.09 69.68 68.43 Aframax 66.61 64.37 64.15 63.71 Total (80k+) 353.16 335.46 327.59 318.27 2017 2018 2019+ Total Orderbook as % of current flee
Slide 14: World Fleet Growth – Product Tankers and VLGC
World Fleet Growth – Product Tankers and VLGC Product Fleet - mn Dwt 11th Nov 2016 1st Jan 2016 1st Jan 2015 1st Jan 2014 LR2 33.71 30.44 27.42 26.93 LR1 24.72 23.75 23.72 23.61 MR 90.12 82.95 78.40 75.74 Total (35k+) 148.55 137.14 129.53 126.27 2017 2018 2019+ Total Orderbook as % of current fleet
Slide 15: Key points on Dry Bulk Markets – Q3FY16
Key points on Dry Bulk Markets – Q3FY16 Asset Prices: -Capesize 5 year old continues to remain low at $24 Mn (Consistent with previous 2 quarters) -Panamax & Supramax 5 year olds continues to trade at $13-$14 Mn levels Freight rates: -BDI has improved from low of 297 in Feb’16 to 1200+ in Dec’16 Coa
Slide 16: Bulkers – Asset Prices (5-year old)
Bulkers – Asset Prices (5-year old) USD USD mn Capesize Panamx Supramax mn Capesize Panamax Supramax 180 40 35 160 30 140 25 120 20 100 15 80 10 5 60 0 40 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2015 2015 2015 2015 2016 2016 2016 20 0 2001-Dec 2002-Dec 2003-Dec 2004-Dec 2005-Dec 2006-Dec 2007-Dec 2008-Dec 2009-Dec 201
Slide 17: Baltic Dry Index (Dec 2000 – Dec 2016)
Baltic Dry Index (Dec 2000 – Dec 2016) Dry Bulk freight rates improved during the quarter Baltic Dry Index 2,500 2,000 1,500 1,257 1,000 500 290 0 Jun-14 Jun-15 Jun-16 Apr-14 Apr-15 May-15 Jan-14 Oct-14 Nov-14 Oct-15 Nov-15 Apr-16 Nov-16 May-14 Jan-15 Jan-16 May-16 Jul-14 Sep-14 Mar-15 Jul-15 Sep-15
Slide 18: China’s iron ore import growth picked up
China’s iron ore import growth picked up Steel Production is steady in 9M 2016 Y-O-Y World Steel China Steel % Growth World % Growth China 2000 15% 1500 10% 1000 5% 500 0% 0 -5% 2013 2014 2015 9M'15 9M'16 China’s iron ore import grew 9% in 9M 2016 Y-O-Y Australia Brazil Others 1200 954 1000 932 746
Slide 19: Coal imports by China shows signs of recovery
Coal imports by China shows signs of recovery mt China coal imports change (Y-O-Y) mt India coal imports change (Y-O-Y) 15.0 10.00 8.00 10.0 6.00 5.0 4.00 0.0 2.00 -5.0 0.00 -2.00 -10.0 -4.00 -15.0 -6.00 -20.0 -8.00 Source – Industry Reports 19
Slide 20: World Fleet Growth – Dry Bulk
World Fleet Growth – Dry Bulk Fleet - Mn Dwt Current Fleet Capesize 314 Panamax 196 Handymax 187 Handysize 94 Total 791 2017 2018 2019+ Total Gross Orderbook %Fleet 6% 2% 1% 9% Slippage – 48% YTD2016 Source – Industry Reports 20
Slide 21: Accelerated scrapping in Dry Bulk
Accelerated scrapping in Dry Bulk Scrapping as % of world fleet (year-wise) Vessel Fleet as on Scrapping Category November 16 2016 YTD 2015 2014 2013 (in mn dwt) (% of beginning fleet) Crude 353 0.25% 0.23% 1.60% 2.40% Product 149 0.52% 0.61% 1.19% 1.69% Dry Bulk 791 3.57% 4.03% 2.25% 3.36% Source –
Slide 22: Greatship (India) Limited Business Review December 2016
Greatship (India) Limited (a 100% subsidiary) Business Review December 2016
Slide 23: Offshore business- Fleet Profile
Offshore business- Fleet Profile The Greatship Group Current Owned Fleet High Fleet Utilization • 4 Jack Up Rigs (350ft) Extent of coverage of • 5 Platform Supply Vessels (PSV) fleet's operating days Category (per cent) (FY17) • 8 Anchor Handling Tug cum Supply Vessels (AHTSV) PSV 40 ROVSV 68 • 2
Slide 24: Key points on E&P markets – Q3FY16
Key points on E&P markets – Q3FY16 Day rates: - Day rates for both AHTS & PSV have come off by ~40%-45% since 2014 Fleet Growth: - Rigs: 2% absolute growth from previous quarter - OSV’s: No growth from previous quarter Slippage: - OSV – 60% - 70% YTD2016 - Rigs – 60% - 70% YTD2016 24
Slide 25: Double-digit decline in drilling demand in 2016
Double-digit decline in drilling demand in 2016 • Drilling demand has been declining continuously since the peak in 2014 • With the Brent oil price falling sharply since 2014, Offshore E&P spending has also come off significantly Source – Offshore Drilling Market Outlook (DVB) 25
Slide 26: Global Fleet Supply – Offshore
Global Fleet Supply – Offshore Fleet & Orderbook (Nos) Jackup Rigs AHTSVs PSV Current Fleet 540 2126 1626 Orderbook 108 176 210 % of O/B to current fleet 20% 8% 13% • YTD actual deliveries have been far lower than scheduled. Due to bleak employment scenario owners have refrained from taking delivery
Slide 27: Financial Highlights Q2 FY 2016-17
FINANCIAL HIGHLIGHTS Q2 FY 2016-17
Slide 28: Q2 FY 2016-17 Financial Highlights
Q2 FY 2016-17 Financial Highlights Standalone Key Figures Consolidated Q2 FY'17 Q2 FY'16 H1 FY'17 (Amount in Rs. crs) Q2 FY’17 Q2 FY'16 H1 FY'17 Income Statement 579.18 595.87 1057.16 Revenue (including other income) 956.92 1033.90 1846.77 326.63 333.21 576.27 EBITDA (including other income) 580.93
Slide 29: Q2 FY 2016-17 Financial Highlights
Q2 FY 2016-17 Financial Highlights Standalone Key Figures Consolidated Q2 FY'17 Q2 FY'16 H1 FY'17 (Amount in Rs. crs) Q2 FY’17 Q2 FY'16 H1 FY'17 Key financial figures 56.40% 55.92% 54.51% EBITDA Margin (%) 60.71% 59.70% 59.96% 7.11% 19.44% 11.53% Return on Equity (ROE) (%) 13.36% 19.31% 12.71% 5.54%
Slide 30: Q2 FY 2016-17 Performance Highlights
Q2 FY 2016-17 Performance Highlights Breakup of revenue days Revenue Days Q2’FY17 Q2’FY16 Owned Tonnage 3.131 2,777 Inchartered Tonnage 101 57 Total Revenue Days 3,232 2,834 Total Owned Tonnage (mn.dwt)* 2.88 2.36 * As on 30th September 2016 Mix of Spot & Time Days (in %) Q2’FY17 Q2’FY16 Average TCY
Slide 31: Thank You
THANK YOU visit us at www.greatship.com
The Great Eastern Shipping — Investor Presentation (December 2016) on 6ix