May 2016 Business & Financial Review The Great Eastern Shipping Co. Ltd. 1
The Company assumes no responsibility with regard to publicly amending, modifying or revising the statements based on any subsequent developments, information or events that may occur. Certain factors may cause actual results to differ materially from those contained in the forward looking statements; including changes in freight rates; global economic and business conditions; effects of competition and technological developments; changes in laws and regulations; difficulties in achieving cost savings; currency, fuel price and interest rate fluctuations etc. 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, prospects and future results which in turn involve certain risks and uncertainties. Forward Looking Statements 2
Bulk Logistics Drilling (Through wholly-owned subsidiary Greatship (India) Limited) India s largest private sector shipping company. Over 67 years of experience - Crude - Products Tankers Shipping (Bulk) Offshore The Great Eastern Shipping Company Corporate Profile 3
16 14 12 10 8 6 4 2 0 1985-86 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Uninterrupted dividend for 30 years 1986-87 Dividend per share (Rs) Two Interim dividends amounting to Rs. 13.5 per share declared and paid in FY16 1984-85 4
Govt/FI 19% Corporate Bodies 6% Public 20% FII 24% Promoters 31% Shareholding Pattern as on March 31, 2016 Shareholding Pattern 5
9 10 11 12 13 14 15 16 17 18 19 20 21 22 Vessel Name Type Jag Lalit Suezmax Jag Lok Suezmax Jag Lateef Suezmax Jag Lakshita Suezmax Jag Lyall Aframax Jag Lata Aframax Jag Laxmi* Aframax Jag Lavanya Aframax 8 Crude Carriers ; Average Age - 13 years Jag Aabha LR1 Jag Aanchal LR1 Jag Amisha LR1 Jag Aparna LR1 Jag Pahel MR Jag Pankhi MR Jag Prabha MR Jag Prakash MR Jag Pushpa MR Jag Prerana MR Jag Pranav MR Jag Pranam MR Jag Padma MR Jag Punit MR 14 Product Carriers; Average Age 8.9 years Sr. No. 1 2 3 4 5 6 7 8 * Contracted for sale with expected delivery in Q1 FY17 32 Vessels Average Age - 10.4 years Total dwt - 2.5 mn Sr. No. Vessel Name Type 23 Jag Vishnu VLGC 1 Gas Carrier; Age - 22 years 24 Jag Aarati Kamsarmax 25 Jag Aditi Kamsarmax 26 Jag Arya Kamsarmax 27 Jag Arnav Kamsarmax 28 Jag Ratan Supramax 29 Jag Rahul Supramax 30 Jag Rishi Supramax 31 Jag Rani Supramax 32 Jag Roopa Supramax 9 Bulk Carriers; Average Age - 6.5 years Shipping business - owned fleet 6
Jiangsu New Yangzi Shipbuilding Co. Ltd, China Mitsubishi Heavy Industries, Nagasaki Shipyard, Japan 4 Kamsarmax Dry Bulk Carriers 1 Secondhand Very Large Gas Carrier (Built 1996) Q1 FY17 Q1 FY17, Q2 FY17 & Q4 FY17 Expected Delivery Committed Capex - $120-130 mn Yard Vessel Vessels on Order & Expected Delivery Vessels on Order & Capital Expenditure 7
Source Industry Reports 0 20 40 60 80 100 120 140 160 180 USD mn VLCC Suezmax Aframax 0 10 20 30 40 50 60 70 80 90 2011 USD mn 2012 VLCC 2013 2014 Suezmax Tankers Asset Prices (5-year old) 2001-01 2002-01 2003-01 2004-01 2005-01 2006-01 2007-01 2008-01 2009-01 2010-01 2011-01 2012-01 2013-01 2014-01 2015-01 2016-01 2015 Q1 2016 Aframax 8
Source Industry Reports 0 20 40 60 80 100 120 140 160 180 USD mn Capesize Panamax Supramax 2011 2012 2013 2014 Panamax Dry Bulk asset prices at 20-year low 0 5 10 15 20 25 30 35 40 45 50 USD mn Capesize Bulkers Asset Prices (5-year old) 2001-01 2002-01 2003-01 2004-01 2005-01 2006-01 2007-01 2008-01 2009-01 2010-01 2011-01 2012-01 2013-01 2014-01 2015-01 2016-01 2015 Q1 2016 Supramax 9
Jan-11 Jan-12 Source Industry Reports 400 Jan-10 500 600 700 800 900 1000 1100 1200 1300 1400 Jan-13 Jan-14 Jan-15 Baltic Dirty Tanker Index Jan-16 400 Jan-10 500 600 700 800 900 1000 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Baltic Clean Tanker Index Jan-16 Low oil prices positively impacted tanker rates 10
2012 mbpd 2013 Demand Refinery Throughput (RHS) mbpd Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Supply 79 78 77 76 75 74 73 72 81 80 Source Industry Reports blip down in refinery margins and increase in fleet during the quarter. Product tanker rates fell marginally on account of warm winter in the west, a by an increase of close to 1 mbpd in refinery throughput & port congestions Crude tanker rates, although lower than Q4 2015 levels, remained healthy led 85 87 89 91 93 95 97 99 Lower oil prices, leading to increased demand & refinery runs 11
Source Industry Reports logistical constraints Forced storage of oil products due to product-specific oversupply and Lower crude oil prices - SPR filling and increase in commercial inventory Rising supply, contango led to commercial stocking, SPR filling and forced storage 12
Apr Mar Feb Jan 2015 Source Industry Reports 6000 6500 7000 7500 8000 8500 2016 2014 2013 4000 5000 6000 7000 8000 9000 2016 2015 2014 Oct Jul Jun Mar Dec Nov Oct Sep Aug Jul Jun May 2013 China Crude Oil Imports ( 000 bpd) Nov Sep Aug May Apr Feb Jan US Crude Oil Imports ( 000 bpd) US and China Crude Oil Imports Dec 13
Source Industry Reports close to historic lows Despite improvement during the quarter, dry bulk rates remain 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 Baltic Dry Index Dry Bulk freight rates improved during the quarter Baltic Dry Index (Jan 2000 Apr 2016) Jan-00 Jun-00 Nov-00 Apr-01 Sep-01 Feb-02 Jul-02 Dec-02 May-03 Oct-03 Mar-04 Aug-04 Jan-05 Jun-05 Nov-05 Apr-06 Sep-06 Feb-07 Jul-07 Dec-07 May-08 Oct-08 Mar-09 Aug-09 Jan-10 Jun-10 Nov-10 Apr-11 Sep-11 Feb-12 Jul-12 Dec-12 May-13 Oct-13 Mar-14 Aug-14 Jan-15 Jun-15 Nov-15 Apr-16 14
2014 2015 Q1 2015 2013 819 2014 932 Australia 2015 953 Brazil Others Q1 2015 227 242-10% Q1 2016 Q1 2016-5% 0% 5% 10% 15% China Steel Production Growth in China Steel Production (LHS) China s iron ore import grew 6% in Q1 2016 2012 745 2013 mt Source Industry Reports 0 200 400 600 800 1000 1200 0 500 1000 1500 2000 World Crude Steel Production Growth in World Steel Production (LHS) mt Steel Production fell during the quarter China s iron ore import growth picked up 15
Oct-14 Jul-14 Apr-14 Jan-14 Source Industry Reports -20.0-15.0-10.0-5.0 0.0 5.0 mt -15-10 -5 0 5 10 mt Jan-15 10.0 China coal imports India coal imports Jan-16 Mar-15 Apr-16 Jan-16 Oct-15 Coal imports by top importers on a declining trend Mar-16 Nov-15 Sep-15 Jul-15 May-15 Jul-15 Apr-15 Jan-15 16
Crude Product 144 779 Product tankers Dry bulk carriers Source Industry Reports 341 Crude tankers (in mn dwt) May 16 Fleet 9% 7% 7% CY2016 4% 6% 8% CY2017 3% 2% 4% CY2018+ 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 mn dwt Dry Bulk Gross Fleet Addition (on current fleet) 0 200 400 600 800 1000 Fleet World Fleet Growth 17
144 779 Product Dry Bulk Source Industry Reports 341 (in mn dwt) May 16 Fleet as on Crude Vessel Category 2% 0.3% 0.1% 2016 YTD 2014 4% 0.2% 0.2% 2% 1% 1% (% of beginning fleet) 2015 Scrapping Scrapping as % of world fleet (year-wise) Accelerated scrapping in Dry Bulk 3% 2% 2% 2013 18
May 2016 Business Review (a 100% subsidiary) Greatship (India) Limited
4 Jack Up Rigs (350ft) 5 Platform Supply Vessels (PSV) 8 Anchor Handling Tug cum Supply Vessels (AHTSV) 2 Multipurpose Platform Supply and Support Vessels (MPSSV) 6 Platform / ROV Support Vessels (ROVSV)* Current Owned Fleet 95 44 MPSSV Jackup Rigs 88 31 ROVSV AHTSV 25 PSV Category Extent of coverage of fleet's operating days (per cent) (FY17) High Fleet Utilization * Includes Greatship Ragini (ROVSV) which has been contracted for sale with expected delivery in H2FY17 Ø The Greatship Group Offshore business- Fleet Profile 20
n Efficient and versatile vessels n Equipped to operate in challenging environments n Specialized/technologically advanced vessels equipped with DP I/DP II (Dynamic Positioning) and FiFi I (Fire Fighting) technologies Technologically Advanced n Demand shifting to modern vessels, especially as safety becomes a major concern for oil companies n Young jack-up fleet with an average age of approx. 4.5 years Young Fleet Cost Efficiencies Revenue Efficiencies - Reduced maintenance capex & opex - Lower Operating costs - Minimum down time - Higher utilization rates Greatship s Modern & Technologically Advanced Fleet & High Utilization 21
Source Industry Reports Outlook likely to have worsened since the last survey 2 years of continuous decline in capex spending Double-digit decline in capex spending in 2016 22
26% % of O/B to current fleet 16% 234 1439 PSV Going forward slippage is expected remain high. market at a very low utilisation. In case of PSVs and AHTSVs more than half the fleet is either idle/stacked or working in spot 65% as on date. has resulted in utilisation levels coming down from around 90% at the start of 2014 to around Asset utilisation levels continue to come off. For premium Jack ups, lack of contract renewals o pushed back to 2017. owners have refrained from taking delivery. A lot of deliveries due in 2016 have now been Source: Rigzone, Marinebase, Industry Reports 10% 191 1942 AHTSVs YTD actual deliveries have been far lower than scheduled. Due to bleak employment scenario 120 Orderbook 464 Jackup Rigs Current Fleet (Nos) Fleet & Orderbook Global Fleet Supply Offshore 23
Q4 FY 2015-16 FINANCIAL HIGHLIGHTS
FY'15 2010.51 840.93 317.30 9335.93 4930.76 3069.33 202.79 530.12 489.68 (649.88) 369.92 FY'16 2279.53 1153.13 609.90 9412.71 5203.64 2884.10 22.37 969.71 (600.38) (809.43) (440.10) Standalone 4078.51 2269.57 1039.40 15631.55 8283.90 5794.11 1894.42 2051.22 (917.52) (1694.55) (560.85) Balance Sheet Total Assets Equity Total Debt (Gross) Long Term Debt (Net of Cash) Cash Flow From operating activities From investing activities From financing activities Net cash inflow/(outflow) FY'16 Consolidated (Amount in Rs. crs) Income Statement Revenue (including other income) EBITDA (including other income) Net Profit Key Figures Q4 FY 2015-16 Financial Highlights 1448.58 (776.05) (228.28) 444.25 15535.15 7430.62 6539.61 2806.28 3713.53 1708.74 748.24 FY'15 25
FY'15 41.83% 6.52% 6.28% 0.62 0.04 61.13 62.50 21.04 21.00 42.50 11.00 FY'16 50.59% 12.04% 9.83% 0.55 0.00 65.30 66.25 40.45 40.37 63.25 13.50 Standalone Share related figures Earnings per share, EPS (Rs) Diluted earnings per share (Rs) Cash Profit per share (Rs) Dividend per share (Rs) Exchange rate USD/INR, end of period (Rs) (Amount in Rs. crs) Key financial figures EBITDA Margin (%) Return on Equity (ROE) (%) Return on Capital Employed (ROCE) (%) Gross Debt/Equity Ratio (x) Net Debt/Equity Ratio (x) Exchange rate USD/INR, average (Rs) Key Figures 68.94 68.80 124.34 13.50 66.25 55.65% 13.23% 9.44% 0.70 0.23 65.30 FY'16 49.63 49.53 90.38 11.00 62.50 46.01% 10.54% 7.81% 0.88 0.38 61.13 FY'15 Consolidated Q4 FY 2015-16 Financial Highlights 26
30,324 23,034 7,717 33,838 21,613 4,418 Crude Carriers Product Carriers (Incl. Gas) Dry Bulk (43)% (6)% 12% Average (TCY $ per day) Q4 FY16 Q4 FY15 % Chg Average TCY Details Time % Spot % Total Time % Spot % Tankers Time % Spot % Dry Bulk 65% 35% 66% 34% 63% 37% 73% 27% 63% 37% 95% 5% Q4 FY16 Q4 FY15 Mix of Spot & Time Days (in %) 2.3 2.4 Total Owned Tonnage (mn.dwt)* * As on 31st March 2,603 0 2,603 2,574 85 2,659 Q4 FY16 Q4 FY15 Owned Tonnage Inchartered Tonnage Total Revenue Days Revenue Days Breakup of revenue days Q4 FY 2015-16 Performance Highlights 27
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