GE Shipping net profit rises 31%

CORPORATE SCORECARD

Buoyant on strong dry bulk carrier revenues, Great Eastern Shipping Company (GE Shipping) reported 31.27 per cent increase in net profit at Rs 240.92 crore for the quarter ended March 31, 2007, compared with Rs 183.52 crore in the corresponding period last year.

Income from operations grew by 7.78 per cent to Rs 592.67 crore for the period under review compared with the previous year's income of Rs 549.88 crore.

GE Shipping posted 5.33 per cent growth in net profit at Rs 883.31 crore for the financial year ended March 31, 2007, compared with the last year's net profit of Rs 838.60 crore. Income from operations slipped by 3.88 per cent at Rs 2,251.11 crore for FY07 compared with Rs 2,342.08 crore for FY06.

The company has recommended a final dividend of Rs 4.50 a share. With the interim dividend paid earlier, the total dividend for the year works out to Rs 11.50 a share. The total outgo on this account would be Rs 201.71 crore including tax on dividend.

Industry analysts pointed out that the growth in the dry bulk freight rates has led to better results. "Dry bulk earnings continued to rise on the back of strong trade demand for commodities from Asia, particularly China. Increasing congestion at the Brazilian iron ore ports and the Australian coal ports increased ship turnaround time, which resulted in a shortage of vessels available in the spot market," the company statement said. The Baltic Exchange Dry Index (BDI), an indicator of dry bulk freight rates, which was 4,421 on January 2, 2007, rose to 5,388 on March 30, 2007. As on May 3, 2007, the BDI stood at 6,276.

During the reporting quarter, at an average time charter yield (TCY) of $ 21,629 a day, dry bulk carriers registered a growth of around 50 per cent in average TCY earnings at around $14,295 a day in the corresponding quarter last year.

On the other hand, for the reporting quarter, crude oil carriers recorded an average TCY of around $30,551 a day compared with $37,269 a day in the corresponding period last year, while product carriers recorded an average TCY of around $21,261 a day for the quarter compared with $21,355 a day in the same period last year.

For the quarter under review, revenue days (including in-chartered days) were 3,925 days against 3,621 days in the corresponding quarter of the previous year. For the quarter, the operating profit margin rose to 55 per cent from 51 per cent in the corresponding quarter.

For the financial year, revenue days (including in-chartered days) were 14,922 compared with 15,327 days in the previous year. During the financial year ended March 31, 2007, in spite of 3 per cent decline in revenue days, net profit rose by 5.33 per cent.

Excluding profit on sale of ships, net profit for the year increased from Rs 507.24 crore to Rs 747 crore, an increase of 47.26 per cent. This was primarily due to increased dry bulk earnings, lower repairs and maintenance expenses towards dry docking cost and higher treasury income. For the previous financial year, the operating profit margin rose to 51 per cent from 48 per cent in the previous year.