Essar Shipping Limited (ESL) has registered
a growth of 107% in net profit at Rs. 100.27 crores (US$
21.43 million) for the year ended 31st March 2001 compared
to Rs. 48.44 crores (US$ 10.35 million) for the corresponding
period last year. Consequently, the Earnings per Share
has gone up to Rs. 5.10 for the year compared to Rs. 2.46
for the last year.
The Company’s total income at Rs. 472.39 crores (US$
100.96 million) is up by 5% compared to Rs. 449.92 crores
(US$ 96.16 million) for the corresponding period last year.
After providing for interest at Rs. 59.24 crores (US$ 12.66
million) and depreciation of Rs. 69.38 crores (USD 14.83
million), the Company has earned a net profit of Rs. 100.27
rores (US$ 21.43 million).
During the financial year under review,
the Company's continued its efforts to reduce operating
cost through streamlining of its operations into three
business groups, (Energy Transpiration, Terminal Operations
and Integrated Transportation). As a result the Company
was able to reduce operating costs by 8% compared to the
corresponding period last year. The Company decreased its
debt by 7% thereby improving D/E ratio from 0.66:1 to 0.56:1
during the year.
The Company continues to operate its fleet of six Suezmax
tankers and four product tankers as part of its Energy
Transportation Group. The Company continues to operate
the Suezmax fleet in the highly competitive Atlantic region.
The Company had, in the early part of the financial year
2000-2001, placed four of the Suezmax tankers on time charter
to provide stable returns to the shareholders, a policy
that the Company has been following for a long time. These
vessels continue to be on time charter with investment
grade companies like Navion Shipping AS (the chartering
wing of Stat Oil, Norway) and Sun Oil, USA. The other two
tankers were kept on the spot market and were able to take
advantage of the upswing in the market during the year.
The Company at the end of July 2001 will have one more
Suezmax tanker coming off charter and avail the benefit
of the currently buoyant freight rates.
During the financial year 2000-2001 the Energy Transpiration
Group contributed 68% towards the revenue of the company
and 67% towards net profit.
The Company operated a fleet of 21 vessel
during the FY 2000-2001 as part of its Integrated Coastal
Transportation division. The ICT division contributed 30%
towards the revenue of the Company and 21% towards the
net profit.
The management of the Company will continue during the
current financial year to streamline its operations and
reduce operating costs, without compromising on the operational
performance of its vessels. The management will continue
its prudent fleet deployment policy.
During the current financial year the management, will
focus on expanding its worldwide market share in the Energy
Transportation segment by providing major oil companies
value added logistic solutions for crude oil transportation.
ESL is uniquely poised to provide these services due to
its investments and experience in the oil terminal business.
With a view to securing a significant market share for
crude oil transportation that is likely to emerge from
India’s import of crude oil, ESL has planned to expand
its crude oil tanker fleet through strategic acquisition,
alliances or merger of its Energy Transpiration Group.
The Company during the current financial
will continue to leverage its last twenty-five years of
experience in dry bulk shipping. The management will focus
on creating Integrated Coastal transportation division
one of the leading costal and intra Asian sea logistics
provider for dry bulk. During the FY 2000-2001 the Integrated
Coastal Transportation division carried approximately 4.5
million tones of dry bulk cargo for steel mills, coal fired
power stations and cement companies.
Worldwide there is a shift towards providing value added
sea logistics services rather then providing traditional
shipping services. The management believes that ESL is
uniquely poised to become a worldwide market leader in
this changing market scenario. The management is continuously
on the lookout for good deals, which would maximize its
shareholders value.
CORPORATE