The Great Eastern Shipping Company (500620) Q4 99/00 earnings summary

Executive summary

• Every operating division improved QoQ in the quarter ended June 30, 2000; the FY99-00 report also described a marked improvement in most segments in Q1 FY00-01.

• FY99-00 operating profits rose in both Shipping and Offshore, while net profit after tax declined YoY; strategic priorities included diversifying trade exposure and modernising the fleet.

Financial highlights

• Revenue was Rs. 9,944.7m vs Rs. 9,808.5m in FY98-99; profit before tax was Rs. 1,264.5m vs Rs. 1,544.3m, and profit after tax was Rs. 1,104.5m vs Rs. 1,264.3m.

• Income from operations increased to Rs. 9,625.9m from Rs. 9,295.0m; profit on ship sales was Rs. 479.5m vs Rs. 5.4m.

• Interim dividend of Rs. 1.50 per share was paid; no final dividend was recommended to conserve resources.

Outlook and guidance

• Dry bulk outlook was described as extremely positive, with firm tanker rates expected across categories; crude carrier rates were expected to remain firm as OPEC maintained higher production.

• LNG shipping was identified as a longer-term opportunity; investment decisions depended on Government policy, with potential investment over 2–3 years and revenue expected from FY03-04.

• Most segments recorded improved earnings in Q1 FY00-01; two dry bulk vessels were sold and an Aframax newbuilding was contracted for delivery in Q2 2002.