Great Eastern Shipping Co. Ltd. · NSE:GESHIP
Great Eastern Shipping — The Great Eastern Shipping — Investor Presentation (August 2015)
33 slides from Great Eastern Shipping's investor presentation, August 2015
Slide 1: Business & Financial Review August 2015
The Great Eastern Shipping Co. Ltd. Business & Financial Review August 2015 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 subsidiary Greatship (India) Limited - Logistics Crude Tankers Product Tankers - Drilling Dry bulk 3
Slide 4: Company at a glance
Company at a glance India’s largest private sector Shipping Company Diverse asset base with global operations Completed 67 years of operations Over 30 years of uninterrupted dividend track record Shareholding Pattern as on June 30, 2015 Public 21% Promoters Bodies 30% Corporate 6% Govt/FI 19% FIIs 2
Slide 5: Shipping business-owned fleet
Shipping business-owned fleet 30 ships aggregating 2.4 Mn dwt, avg. age 9.6 years 21 Tankers avg.age 11.0 years - 8 Crude carriers (4 Suezmax, 4 Aframax) avg. age 12.2 years - 12 Product tankers (4 LR1, 8 MR) avg. age 8.4 years - 1 Very Large Gas Carrier avg. age 21.0 years 9 Dry bulk carriers avg.
Slide 6: Shipping business - CAPEX plan
Shipping business- CAPEX plan Vessels on Order Vessel Yard CAPEX: ~ USD 180 mnExpected Total committed –ADD YR Delivery WISE 1 Medium Range Product TankerCAPEX BRK UP) STX Group Q4 FY16 1 Kamsarmax Dry Bulk Carrier* Tsuneishi Heavy Industries (Cebu) August/September 2015 (Already Inc contracted for
Slide 7: Asset Price Movement (5 yr old) - Tankers
Source: Clarkson 0 20 40 60 80 100 120 140 160 180 USD mn 2001-01 2001-07 2002-01 2002-07 2003-01 2003-07 2004-01 2004-07 2005-01 2005-07 2006-01 VLCC 2006-07 2007-01 2007-07 2008-01 2008-07 Suezmax Amt in US$ mn 2009-01 2009-07 2010-01 MR Timeline- Jan 2001 till July 2015 2010-07 2011-01 2011-07 20
Slide 8: Asset Price Movement (5 yr old) – Dry Bulk
Source: Clarkson - 20 40 60 80 100 120 140 160 180 USD mn 2001-01 2001-07 2002-01 2002-07 2003-01 2003-07 2004-01 2004-07 2005-01 2005-07 2006-01 Capesize 2006-07 2007-01 2007-07 2008-01 Panamax 2008-07 Amt in US$ mn 2009-01 2009-07 2010-01 Timeline- Jan 2001 till July 2015 2010-07 Supramax 2011-01
Slide 9: Asset Price Movement
Asset Price Movement Long-term year High /Low: (5 year old assets) (Amt in $mn) High Low Current Tankers 165 49 VLCC 84 (2008) (1994) 105 32 Suezmax 61 (2008) (1993) 46 20 MR 28 (2007) (1999) Dry Bulk 155 25 Capesize 35 (2008) (1999) 92 14 Panamax 18 (2007) (1999) 75 13 Supramax 15 (2007) (1998) 9 S
Slide 10: BDTI & BCTI Movement (Jan 2012 to July 2015)
BDTI & BCTI Movement (Jan 2012 to July 2015) 1,200 1,100 1,000 900 800 700 600 500 Jan-12 Mar-12 May-12 Nov-12 May-13 Nov-13 May-14 Nov-14 Mar-15 May-15 Jul-12 Sep-12 Jan-13 Mar-13 Jul-13 Sep-13 Jan-14 Mar-14 Jul-14 Sep-14 Jan-15 Jul-15 Crude tankers freight rates have risen significantly • Low oil
Slide 11: Surplus oil led to lower oil prices; strong refinery margins
Surplus oil led to lower oil prices; strong refinery margins leading to higher crude runs Oil demand, Supply & Surplus Global refinery throughput & growth Global Refinery Crude Runs (mbpd) Demand (mbpd) Supply (mbpd) Growth in Global Refinery throughput y-o-y (%) 97 Growth in Oil demand y-o-y (%) 79
Slide 12: Strong refinery margins
Strong refinery margins Brent Rotterdam Cracking Refining Arab Light Singapore Simple Margin Refining Margin LLS USG Simple Refining Margin 12 Source: Industry reports
Slide 13: Stock building increased led by contango in the oil market
Source: Industry reports 900 950 1000 1050 1100 1150 1200 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 the oil market May-13 Jul-13 Sep-13 OECD Crude Oil Stocks (m bbls) Nov-13 Jan-14 China implied crude o
Slide 14: Ton-miles rise as surplus Atlantic barrels find home in Asia
Ton-miles rise as surplus Atlantic barrels find home in Asia Indian import growth (tonne-mile & Other Asia import growth (tonne-mile & volumes) volume) China crude imports from Colombia China crude imports from Brazil 14 Source: Industry reports, DNB Markets
Slide 15: Middle East refinery capacities get commissioned, Asia to account for future additions
Middle East refinery capacities get commissioned, Asia to account for bulk of future capacity additions Future refinery capacity additions Middle East (Crude Throughput) New refineries in Saudi Arabia (that came online in 2013-15) have already led to increase in products exports from the region Long
Slide 16: Overcapacity, potential refinery closures in the OECD region
Overcapacity, potential refinery closures in the OECD region Actual and forecast refinery closures 16 Source: Industry Reports
Slide 17: Growing Product trade… Changing trade patterns
Growing Product trade… Changing trade patterns 17 Source: Industry Reports
Slide 18: BDI Movement (Jan 2001 to August 2015)
0 2,000 4,000 6,000 8,000 10,000 12,000 Source: Baltic Exchange Nov-99 Apr-00 Sep-00 Feb-01 Jul-01 Dec-01 May-02 Oct-02 Mar-03 Aug-03 Jan-04 Jun-04 Nov-04 Apr-05 Sep-05 Feb-06 Jul-06 Dec-06 May-07 Oct-07 Mar-08 Aug-08 Jan-09 Jun-09 Nov-09 Apr-10 Sep-10 Feb-11 Jul-11 Dec-11 growth May-12 Oct-12 Mar-1
Slide 19: Slow growth in steel consumption impacting seaborne iron ore imports
Slow growth in steel consumption impacting demand for seaborne iron ore imports China crude steel production (mt) China iron ore imports (mt) Australia India Brazil 60 50 Substitution of other import 40 30 20 sources by Australia leading to 10 0 short-haul trade Jan Mar May Jul Sep Nov Jan Mar May J
Slide 20: Focus on pollution control, rising hydropower – Severe blow to coal trade
Focus on pollution control, rising hydropower generation – Severe blow to coal trade China coal imports India coal imports China coal imports decline sharply. Indian coal imports holding up in the short term, however, country’s domestic coal production is set to increase going forward 20 Source: Ind
Slide 21: World Fleet Growth
World Fleet Growth 800 mn dwt Fleet 700 World Fleet Dry Bulk Crude Product CY2015 CY2016 CY2017+ 600 addition Aug 15 500 400 (in mn dwt) 300 200 Crude tankers 334 2% 8% 7% 100 Product tankers 138 5% 8% 4% 0 Dry bulk 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 768 6% 8% 2% carrie
Slide 22: Accelerated scrapping in Dry Bulk
Accelerated scrapping in Dry Bulk Scrapping as % of world fleet (year wise) Fleet as on Scrapping Vessel Category CY2012 CY2013 st 1 Jan 2015 H1 2015 (in mn dwt) (in mn dwt) 329 0.7 Crude 3% 2% 131 0.3 Product 2% 2% 756 20 Bulk 5% 3% 22 Source: Clarkson
Slide 23: Greatship (India) Limited Business Review
Greatship (India) Limited (a 100% subsidiary) Business Review August 2015 23
Slide 24: 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) Category fleet's operating days (per cent) 8 Anchor Handling Tug cum Supply Vessels (AHTSV) PSV 90 ROVSV 100 2 Multipurpose Pla
Slide 25: Greatship's Modern & Technologically Advanced Fleet & High Utilization
Greatship’s Modern & Technologically Advanced Fleet & High Utilization Young Fleet Young fleet with an average age of approx. 4 years by FY 2014-15 - Higher utilization rates Demand shifting to modern vessels, Revenue especially as safety becomes a major Efficiencies - Minimum down time concern for
Slide 26: Sharp decline in E&P spending led by lower oil prices
Sharp decline in E&P spending led by lower oil prices E&P spending set to decline Oversupply of crude oil led to significant decline in E&P spending Stacking of rigs & renegotiations of rates on the rise, utilisations levels decline Deep & Ultra-deep water projects severely impacted Impact on shallo
Slide 27: Global Fleet Supply – Offshore
Global Fleet Supply – Offshore Fleet & Orderbook (Nos) Jackup Rigs AHTSVs PSV / Supply Current Fleet 489 1,959 1,392 Orderbook 127 204 307 % of O/B to current fleet 22% 10% 26% • Orderbook is high – Slippages on Asian yards could be high • Cold stacking of vessels has increased –Older vessels previo
Slide 28: Financial Highlights Q1 FY 2015-16
FINANCIAL HIGHLIGHTS Q1 FY 2015-16 28
Slide 29: Q1 FY 2015-16 Financial Highlights
Q1 FY 2015-16 Financial Highlights Standalone Key Figures Consolidated Q1 FY16 Q1 FY15 (Amount in Rs. crs) Q1 FY16 Q1 FY15 Income Statement 541.42 494.02 Revenue (including other income) 1026.87 906.05 287.98 218.44 EBITDA (including other income) 584.73 468.57 162.16 87.61 Net Profit 323.67 222.93
Slide 30: Q1 FY 2015-16 Financial Highlights
Q1 FY 2015-16 Financial Highlights Standalone Key Figures Consolidated Q1 FY16 Q1 FY15 Q1 FY16 Q1 FY15 53.19% 44.22% EBITDA Margin (%) 56.94% 51.72% 12.94% 7.19% Return on Equity (ROE) (%) 16.99% 12.90% 10.23% 6.61% Return on Capital Employed (ROCE) (%) 11.17% 9.15% 0.60 0.66 Gross Debt/Equity Ratio
Slide 31: Q1 FY 2015-16 Performance Highlights
Q1 FY 2015-16 Performance Highlights Breakup of revenue days Revenue Days Q1’FY16 Q1’FY15 Owned Tonnage 2,574 2,602 Inchartered Tonnage 68 0 Total Revenue Days 2,642 2,602 Total Owned Tonnage (mn.dwt)* 2.36 2.37 * As on 30th June Mix of Spot & Time Days (in %) Q1’FY16 Q1’FY15 Average TCY Details Dry
Slide 32: Book Value & Net Asset Value (NAV) comparison
Book Value & Net Asset Value (NAV) comparison Last 4 quarters Consol. Book Consol. NAV Value (Rs. Per share) (Rs. Per share) June 2015 518 536 March 2015 493 518 December 2014 496 557 September 2014 480 558 32
Slide 33: Thank You
THANK YOU visit us at www.greatship.com 33
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