A. R. Ramakrishnan, Managing Director and Director, Essar Shipping Limited is a Mechanical Engineer and Post Graduate from IIM Calcutta.He has over 32 years of experience.Prior to that, He was the Whole-Time Director of Essar Shipping Port and Logistics Ltd.
Essar Shipping Limited operates a diversified fleet of 25 vessels, including VLCCs, Capesizes, MiniCapes, Supramaxes, mini bulk carriers and tugs. A sizeable part of the capacity is deployed on long-term contracts and COAs, insulating the company from the volatility of spot markets.
The Oilfields Services business provides contract drilling services to oil & gas companies across the globe. This business owns one semi-submersible rig and 12 land rigs. The company has two new jack-up rigs on order.
The Logistics business provides end-to-end logistics services, including intermodal transportation. It manages a fleet of over 5,000 trucks for inland transportation of steel and petroleum products. The Company also handles a sizeable volume of large project cargo movement.
Following are the key highlights of the conference call conducted by Essar Shipping after its latest quarterly results.
“The outlook for the shipping industry is that pressure will continue for several months” said A. R. Ramakrishnan.
Comment on your performance in Q1 FY13?
The first quarter has been quite challenging as the freight market was under tremendous pressure for variety of reasons both in terms of economic condition and uncertainty in Europe.
The outlook for the shipping industry is that pressure will continue for several months.
Our focus area would to leverage our debt.
We have completed dry-docking of three dry-bulk carriers during the first quarter and other two vessels that will join over the next couple of months.
Brief us about your financials?
Essar Shipping Limited (ESL) announced its financial results for the quarter ended June 31, 2012.
Q1 FY13 Highlights:
The Company’s revenue increased by 38% to Rs.9.25bn from Rs.6.70bn in Q1 FY12.
Net profit increased by 186% at Rs.539mn as against Rs.188.3mn in Q1 FY12.
EBITDA increased to Rs.2.52bn as against Rs.1.75bn Q1 FY12, registering an increase of 43 %.
How was the quarter overall?
The company has maintained its performance despite challenging market conditions. While the sea transportation business will leverage on long term contracts, the oilfields services business will benefit from a firm market.
The Sea Transportation business registered revenue of Rs. 4.58bn in Q1 FY13, up 53% from Rs.2.99bn for the corresponding period in the previous year.
Oilfields Services revenue increased by 91% to Rs.1.72bn in Q1 FY13 from Rs.901.5mn for the corresponding period in the previous year.
The Logistics Business revenue stood at Rs.2.92bn for Q1 FY13 against Rs 2.85bn in the corresponding period of the previous fiscal year.
What were the main developments during Q1 FY13?
MV Shravan - 105000 DWT Minicape vessel joined the fleet during the quarter.
The company has received special recognition from The FE-EVI Team Awards for the unique initiatives being adopted for promoting sustainability, climate change and promoting disclosure of non-financial performance.