Investor Presentation

Investor Presentation
May 2010
Enterprise ● Energy ● Endurance
1
Table of contents
1.
Company Overview
2.
Company Financials
3.
Key Highlights
4.
Company Highlights
2
Section 1:
Company Overview
Genesis of Great Offshore Limited (GOL)
Started as a business division of the Great Eastern Shipping Co. Ltd. (Pre Oct-06 )
1
•
•
Demerger into a separate listed company (Oct-06 – Apr-09)
2
•
•
•
3
Great Offshore Limited (GOL) was a division of the Great Eastern Shipping (GES)
Since commissioning its operations in 1983, Great Offshore has serviced major E&P operators in India as well as in the
international waters of the North Sea, the Middle East, South Africa and South East Asia
Through a Scheme of Arrangement, GOL was demerged into a separate company
Demerger Scheme: for every 5 shares in GES, 4 shares of GES & 1 share of GOL was allotted
December 2006 - GOL lists at the stock exchanges
Emergence of Bharati Shipyard as the single largest shareholder (May-09 – Present Day)
•
•
•
•
May 09 – Personal pledge invoked of erstwhile promoter
14.89% of the total shareholding transferred to Bharati Shipyard Limited
Two bidders ( Bharati Shipyard and ABG Shipyard) make simultaneous Open Offer to minority shareholders
Bharati Shipyard emerged as the single largest shareholder in GOL
GOL has a tremendous track record of over 25 years of operational experience
4
Stable and supportive shareholders to drive growth
Market Data ( 19 May, 2010)
• Market cap (USDm)
• 52 week H (INR)
• 52 week L (INR)
359
584
245
Prom oters
16.0%
Others
28.9%
Bharati
Shipyard
44.3%
Others
55.7%
MFs
1.3%
FIIs
7.0%
Others
84.0%
March 31, 2009
Bharati
Shipyard
49.0%
Insuranc
e Cos.
2.0%
Jan 19, 2010
ABG
Shipyard
11.8%
March 31, 2009
Post completion of Open Offer
Emergence of a Bharati Shipyard Limited as a strong principal shareholder
– Stability derived from strength of the principal shareholder entity
– Continuity of the Management Team throughout the transition phase
Note:
1.
USD1 : INR 46, RBI reference rate as on May 19, 2010
2.
Bharti Shipyard holds GOL through its entities : Natural Power Ventures Private Limited and Dhanashree Properties Private Limited
3.
Source: BSE, SEBI
5
India's prominent integrated offshore oilfield services provider
Offers a broad spectrum of services to upstream oil and gas producers
Offshore Drilling
Scale(1)
Offshore Marine
Logistics
Marine Engineering
& Projects
Port and Terminal
Support
Air Logistics
• 3 Rigs
− Jack –up
− Kedarnath
− Amarnath
− Barge
− Badrinath
Diverse fleet of 28 assets :
• 12 AHTSV
• 7 Platform Supply
Vessels
• 2 FFSV
• 4 Anchor Handling Tugs
• 1 Multi Support Vessel
• 2 Supply Vessels
• 1 Hook up
Accommodation Barge
on spot charter
• 1 Heavy Lift Vessel
• 1 Construction Barge
• 12 assets operating with
private sector and public
sector ports / terminals
• 6 Helicopters
• Offshore drilling
experience of 2 decades
• Current asset base of 3
drilling rigs – One Drill
Barge and two Jack Up
• Of the total 28 assets,
15 are capable to
operate in deep waters
• Currently 6 assets
operate globally
• Demonstrated track
record in executing
diverse projects on
turnkey basis
• EPIC contract scope :
Surveys, Detailed
Design Engineering ,
Procurement ,
Fabrication
Transportation ,
Installation , Hook up
and commissioning
• One of the largest
organized player in
India
• High safety record
provides comfort and
potential for repeat
business
• Operates on both the
east and the west coast
of India
• Clients include PSU and
private names
• 26% JV with United
Helicharters
Key
highlights
All assets are held in the Balance Sheet of Great Offshore Limited
GOL is equipped to provide complete solution to all the oil services need of E&P companies
EPIC: Engineering, Procurement, Installation and Commissioning
Note:
1.
Does not include “1 Floating Dry Dock” which is used across business segments
2.
Information pertaining to fleet as of March 31, 2010
6
Disciplined fleet expansion
Ability to identify acquisition opportunities throughout the oil & gas cycle
Construction
Barge, 1
Rigs, 2
Construction
Barge, 1
Rigs, 2
Construction
Barge, 3 FDD, 1
Rigs, 3
Harbour
Tugs, 9
OSVs, 16
Harbour
Tugs, 11
FY2000 – 28 assets
OSVs, 18
Harbour
Tugs, 12
OSVs, 28
FY2010 – 47 assets
FY2005 – 32 assets
15 assets are capable of operating in deep water
In addition, we have entered into new build contracts and placed orders for an MSV and a 350 feet Jack up Rig
50
47
No. of Assets
40
30
32
33
2005
2006
39
40
2007
2008
43
28
20
Rapid growth in assets during the
period 2005-2010
10
0
2000
2001
2002
2003
2004
2009
2010
Over the years GOL has built a diversified base of high quality assets
Note:
1.
Asset position as of financial year ending March 31st
7
GOL is uniquely positioned in the industry
Great Offshore
Great Offshore
Great Offshore
Great Offshore
Great Offshore
Greatship (India)
Offshore
Assets (1)
• 47 assets (3 rigs)
Rigs
9
Marine
Engineering
Services
9
Port and
Terminal
Support
9
Financials
FY 2009(3)
FY 2010(2)
• Rev – USD255m
• EBITDA – USD110m
• EBITDA Margin - 43.2%
• D/E Ratio – 1.28x
• Mcap – USD359m
• 19 assets (includes
floaters, drill ships and
jack-up rigs)
• 12 assets
• 9 assets
• 16 assets (2 rigs)
9
8
8
9
8
8
9
8
8
8
8
8
FY 20093)
• Rev – USD751m
• EBITDA – USD465m
• EBITDA Margin – 61.9%
• D/E Ratio – 9.53x
• Mcap – USD664m
FY 2009(3)
• Rev – USD36m
• EBITDA – USD20m
• EBITDA Margin – 54.1%
• D/E Ratio –2.80x
• Mcap – USD73m
FY 2009(3)
• Rev – USD77m
• EBITDA – USD28m
• EBITDA Margin – 36.5%
• D/E Ratio – 1.56x
• Mcap – USD106m
FY 2009(3)
• Rev – USD55m
• PAT – USD11m
• D/E Ratio – 0.52x
• Unlisted company
Great Offshore is the only domestic player providing the entire spectrum of E&P services
Note:
1.
2.
3.
4.
5.
Offshore Assets position for GOL as of FY2010, for other companies the asset position is as per the company’s website/ media reports
Limited Review FY2010 financials for GOL
Source: FY 2009 Annual Report/ Earning Release, Financials (consolidated) as FY 2009 for companies other than GOL, D/E (consolidated) = (Share Capital + Reserves)/ Total Debt
USD1 : INR 46, RBI reference rate as on May 19, 2010
Market Cap data as on May 19, 2010 (BSE)
8
Serving the entire E&P value chain
Leading to lower cyclicality in performance
5 yrs
Exploration
Drilling
Drilling
Seismic
15 yrs
20 yrs
Sampling
Exploration
Drilling
Production
Drilling
Engineering
Fabrication/
Construction
Great Offshore
is present
across major
Product &
technology
portion of the
Assembly
E&P value
chain therefore
Installation
Heavy Lift
there is limited
Subsea
Construction
impact on its
performance
Production
Platform
supply
Abandonment
Production &
Operations
Maintenance &
Modifications
Heavy Lift
Decommissio
ning
due to oil price
volatility
E&P value chain
9
Diversified geographic operational base
Leading presence in the international markets
Strong presence base across boundaries
ABERDEEN
SAKHALII
WEST COAST
OF INDIA
MAURITIANA
EAST COAST
OF INDIA
VIETNAM
PERSIAN GULF
TRINIDAD
SOUTH COAST
OF INDIA
MALAYSIA
INDONESIA
MOZAMBIQUE
JAKARTA
CAPE TOWN
Diversified presence in high E&P growth locations
10
Unique presence in Marine Engineering Business
Diversification into a capex light business
Scope of the service provided
Projects Completed / Under Execution (FY 2009)
• Services provided by Great Offshore
− Brown field projects
− Top side process revamp projects
− Structural revamp projects
− Clamp on project
− Process module project
• GOL has successfully undertaken various types of projects both in India and
internationally with customers like L&T, ONGC, SMOE, Mubarak Marine LLC and
Hyundai Engineering
Recent Projects Include
• NC Platform Revamp Project in consortium with Supreme Offshore Construction &
Technical Services Ltd.
• GOL owns and operates the construction barge Gal Constructor with a complementing
anchor handling tug, designed to provide a integrated services to the offshore
construction industry
Source: Annual Report
• Execution of the lump-sum turnkey engineering contract awarded by ONGC at a value
of INR 240 Cr.
Source: Annual Report
Recent Assignments (FY 2010)
ONGC – BBBLRPII Project
(Riser Protector)
ONGC – BBBLRPII Project
(Barge Bumper)
Demonstrated tack record in successful completion of diverse marine engineering and construction projects
11
Experienced leadership and management team
Soli C. Engineer
Executive Director
• Mr. Soli C. Engineer has four decades of experience in the shipping and offshore sectors.
• He has been with Great Offshore since 1978
• In 2009, Mr. Engineer was appointed as Executive Director of Great Offshore Limited.
PK Sah
General Manager –
Drilling
• A graduate in Mechanical Engineering, Mr. Sah has over 33 years of rich experience in the field of
Drilling.
• He has been associated with organizations such as ONGC, Reliance Industries, and Rohtas
Industries amongst others.
• Having joined us in 2006, Mr. Sah has pioneered the drilling division of the company. Currently
heading the Drilling division, Mr. Sah oversees the functioning of the two rigs Kedarnath &
Badrinath.
Ram Choudhary
Head – Engineering
Services
• Mr. Choudhary is a Mechanical engineer with an MBA from IGNOU. His technical qualifications
include the Aeronautical Engineering course and Certified Engineer’s course on Mi – 17 Helicopter.
• He joined the Great Eastern Shipping company in the year 1997 in the Air – OGD department.
• Today as the Head of the Engineering Services he is currently pioneering the expansion of
business in the area of marine engineering services
Chetan Parulekar
General Manager –
Business
Development &
Operations
• A Bachelor of commerce from the Mumbai University, Mr. Parulekar pursued a double Diploma in
Export Import and in Material Management.
• His prolific expertise includes Ship Management, Agency Operations, Chartering and logistics.
• He joined Great Offshore Ltd. in 2004 and plays a key role in enhancing the company prospects
Mr. Anil Rao
General Manager –
Head Fleet
Management
• A Marine Engineer from the esteemed DMET and a holder of First Class Certificate of
Competency, Mr. Rao has over 30 years of experience.
• Mr. Rao has over a decade of sailing experience on all types of vessels
• Helps in the smooth functioning of the large fleet sailing across the globe, as well as the successful
conversions carried out by his team.
Mr. Rajat Dutta
General Manager –
Corporate Affairs
• Mr. Dutta is a Fellow of the Institute of Chartered Accountants of India, & Institute of Company
Secretaries of India and a Law Graduate
• In a career spanning over 25 years, he has been associated with organizations such as RBI,
TORRENT, CRISIL, GE Shipping Company Ltd. and All Cargo Global Logistics Ltd.
• Mr. Dutta handles the corporate affairs of Great Offshore and assists the Office of the Executive
Director of the company
Well balanced team of highly capable
individuals
Independent management: Increased
fleet by 6 assets in a period of
significant promoter uncertainty (FY10)
12
Section 2:
Company Financials
Consolidated Financials
Total Income (USDm)
Operating EBITDA (USDm)
400
200
350
CAG
300
.6%
R : 19
248
255
150
250
200
59.8%
58.2%
54.3%
137
138
FY2009
FY2010
97
178
100
150
100
50
50
0
0
FY2008
FY2009
FY2008
FY2010
PBT (USDm)
PAT (USDm)
100
100
26.7%
28.2%
21.3%
24.6%
24.1%
17.3%
70
60
50
54
48
50
44
44
0
0
FY2008
FY2009
FY2010
FY2008
FY2009
FY2010
Margins
Note:
1.
Consolidated entities include: Great Offshore Fujairah LLC-FZC, Deep Water Services (India) Ltd, Great Offshore (International) Limited, KEI-RSOS Maritime Ltd, Rajamahendri Shipping and Oil Field Services Ltd.
2.
FY 2008 Audited, FY 2009 : Audited: FY 2010 [Limited Review]
3.
USD1 : INR 46, RBI reference rate as on May 19, 2010
14
Return and Financial Ratios (Consolidated)
Return on Average Networth (%)
40%
14%
33.8%
35%
30%
Return on Average Capital (%)
12.6%
26.9%
10%
21.7%
25%
20%
8%
6.5%
6%
15%
4%
10%
2%
5%
0%
0%
2008
2009
2010
2008
Networth (USDm)
2009
2010
Total Capital (USDm)
300
754
800
244
250
200
11.9%
12%
700
611
600
192
500
162
150
397
400
300
100
200
50
100
0
0
2008
2009
2010
2008
2009
2010
Note:
1.
Consolidated entities include: Great Offshore Fujairah LLC-FZC, Deep Water Services (India) Ltd, Great Offshore (International) Limited, KEI-RSOS Maritime Ltd, Rajamahendri Shipping and Oil Field Services Ltd.
2.
FY 2008 Audited, FY 2009 : Audited: FY 2010 [Limited Review]
3.
USD1 : INR 46, RBI reference rate as on May 19, 2010
4.
Return on Average Networth = (PATcurrent year)/ (Networthcurrent year +Networthprevious year)/2 , Return on Average Capital = (PATcurrent year)/ (Total Capitalcurrent year +Total Capitalprevious year)/2
15
Revenue Statement (consolidated)
Year ended March 31
(USDm)
2008
2009
2010
Operating Income
162
235
253
Operating EBIDTA
Operating Margin %
97
59.8%
137
58.2%
138
54.3%
Other Income
12
13
2
Depreciation
21
25
31
Interest & Finance Charges
15
23
25
PBT
48
70
54
PAT
44
60
44
24.61%
24.10%
17.28%
Margin %
16
Balance Sheet (consolidated)
Year ended March 31
(USDm)
2008
2009
2010
Shareholders’ Funds
192
162
244
Loan Funds
206
448
509
Sources of Funds
Deferred tax liability (net)
Total
1
397
611
754
Fixed Assets
302
514
678
Net Current Assets
90
75
55
Goodwill
0
20
20
Investments
4
–
–
Deferred tax assets
1
1
–
397
611
754
Application of Funds
Total
17
Section 3:
Industry Highlights
Positive Industry Trends
Driven by demand push from emerging economies and supply constraints
In ‘000s of barrels per day unless otherwise stated
Europe
2007-08
Former Soviet Union
60
2008-09
161
(32)
2009-10
10
(787)
North America
(238)
136
Middle East
561
(1300)
(913)
320
124
Asia
Latin America
225
401
191
55
Africa
114
470
137
106
29
Global demand growth
(million barrels per day) (0.29)
(1.33) (1.44)
• Global oil demand is expected to pick up to 86.3 mb/d in 2010 from 84.9 mb/d in 2009
• Countries outside of the organisation for economic cooperation and development will lead 2010 demand recovery
• Demand in Asia and the Middle East, which are the key geographical segments in which the GOL operates, is expected to lead the recovery
Positive long term industry fundamentals driven by demand from growth of developing economies
Source: International Energy Agency Report 2009
19
Supported by strong long term demand projections
World Oil Demand Breakup
3%
World Oil Demand Projection
10%
Agriculture
35%
120
Non OECD Consumption (In Mn bpd)
100
OECD Consumption (In Mn bpd)
Industry
80
Transportation
60
Residential
40
Others
20
35.8
40
43.4
47.8
52.2
56.6
34.5
41.4
49.5
49.2
46.3
47.2
48.1
48.9
50
1990
2005
2006
2010
2015
2020
2025
2030
25.3
0
46%
6%
%
): 3.4
FY30
–
0
1
R (FY
CAG
3.1
2.7
2.5
2.4
4.0
3.0
4.7
3.9
4.3
2.0
1.2
1.0
0.0
1990
2005
2006
2010
2015
China – oil demand projection
Million Barrels Per Day
Million Barrels Per day
India – oilfor
demand
projection
Transportation accounts
a sizeable
chunk of the demand
5.0
CAG
%
): 1.1
FY30
–
0
1
R (FY
2020
2025
2030
20.0
15.0
CAG
10.0
5.0
6.7
R
3%
0): 2.
–FY3
0
1
Y
(F
7.2
8.5
13.8
15.3
12.1
10.0
2.3
0.0
1990
2005
2006
2010
2015
2020
2025
2030
Emerging markets, especially India and China to lead the oil demand growth , leading to long term growth in oil demand
Source: eia – U.S. Energy Information Administration , Independent Statistics and Analysis
20
Strong supply side fundamentals
Global spare capacity to tighten by 2011-12
OPEC share in global supply rising
PEC spare capacity
7
10%
6
93
92
60
8%
91.5
5
91.5
50
4
3
4%
2
91.0
91.2
91.0
91.0
6%
mb/d
mb/d
Global oil supply
OPEC supply as % of total
Non-OPEC supply as % of total
70
Spare cap. as a % of dem and
91
40
90
30
89
20
88
10
87
2%
1
Mbl/d
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
0%
2000
0
86
0
2007
2008
2009
2010
2011
2012
CY2007
CY2008
CY2009
CY2010E
CY2011E
CY2012E
Non OPEC
50.9
50.7
51.3
51.5
50.8
50.0
OPEC
31.2
31.0
28.7
29.6
31.3
33.0
Aggregate
82.1
81.7
80.0
81.1
82.1
83.0
Oil supply is tightening, which combined with long term growth in demand, imply stable to increasing oil prices
Source: eia – U.S. Energy Information Administration , Independent Statistics and Analysis
Morgan Stanley
21
Huge initiatives by the Indian Government
Spearhead massive investment in domestic E&P industry
E&P in India – Opportunity galore
NELP a strong boost to growing energy demand
India has 16% of the global population and 0.5% of the
petroleum reserves
India is the 4th largest consumer of oil in the world - ~80% of
crude oil is imported ( ~35% of total India import bill)
Indian sedimentary basins with low drilling density require
technology & capital intensive accelerated exploration
NELP to spur
demand for
offshore rigs
and OSv’s
NELP
introduced in
the year
2000
USD50bn of estimated investment required in the next 15-20
years
Source: ONGC reports
Significant increase in blocks awarded to E&P players
Deep water
60
50
40
Shallow water
Onshore
30
20
10
0
NELP- I
NELP- II
NELP III
NELP - NELP - V NELP IV
VI
NELP V11
High growth
potential~ 21%
of the total
acreage has
been explored
or is under
exploration
Ministry of
Petroleum & Natural Gas
Demand for rigs
to firm up on
account of old
and new NELP
work
commitments
Eight rounds
of NELP
implemented
till date
Led to 25
companies in E&P
business
(previously 2
national oil
company)
Source: Broker Research
Energy security and growing energy demand provides immense growth opportunities to E&P and allied sectors
22
Section 4:
Company Highlights
Great Offshore – Key Company Highlights
Long Track Record of Providing Offshore Oilfield Services
1
• Operational experience of over 25 years – one of the largest offshore logistics companies in India
2
3
Integrated Offshore Services Provider with a Diversified Asset Fleet
•
•
•
•
Only Indian company operating in all segments of offshore oil filed services spectrum
Largest fleet of offshore supply vessels in India
Demonstrated track record in successful completion of diverse marine engineering and construction projects
Foray into port management and single point mooring business through the inorganic route
Strong Contract Offshore Services Backlog
• Time charters ensures earnings visibility and risk diversity
4
Strong Customer Relationships
• Significant business and enviable track record with India’s largest NOC - ONGC
• International presence in high E&P growth markets (North Sea & Middle East)
5
Professional Management Team
• Extensive experience in the offshore services sector
24
25