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Wednesday, 26 October 11
PWCS GLOBAL SHIPPING BENCHMARKING ANALYSIS: RECOVERY IN 2010 BUT GREAT UNCERTAINLY FOR 2011
 The recovery of global trade in 2010 to the same levels as 2008 led to an improvement in the overall performance of shipping companies in 2010 compared to 2009, according to the 2010 Global Shipping Benchmarking Analysis of PwC. But this does not mean that the shipping industry is on a safe path to recovery, since the deteriorating economic situation in Europe and the US have increased volatility and market uncertainty, impacting shipping companies’ performance as reflected in their reported results in the first half of 2011, which have been worse than the same period in 2010.
In its global benchmarking analysis, which is in its third year of publication, PwC has analyzed certain key performance indicators (KPIs) of 150 shipping companies from around the world. The results are based on an analysis of their published annual reports over the last five years including 2010. The analysis covers both quantitative and qualitative information and gives an insight into how these companies are facing recent challenges and the main drivers of performance in the shipping industry.
The analysis shows that the Container and the Dry Bulk subsectors were the best performers in 2010, while the Tanker subsector was the worst performer. With the exception of net debt ratio and the ratio of net fixed assets to sales ratio, all financial performance indicators stabilized or improved in 2010 compared to 2009.
Socrates Leptos-Bourgi, Partner of PwC in Greece and the PwC Global Shipping & Ports Leader, says: “We’ve seen improvements in freight rates across all trades in 2010, which combined with cost savings implemented in 2009, have improved the reported profitability of shipping companies in 2010. How good or bad things will get in the future depends on how well the world economy copes with the post financial crisis problems that the US is facing, the resolution of the European sovereign debt crisis, the challenge of rebuilding northern Japan and the prospects of the Chinese economy. However, given the pressures caused from the supply of new tonnage in the shipping markets, it will require an extraordinary performance on all accounts to bring the shipping industry back to a period where returns become relatively attractive again.”
While the world economy is still fragile, with increasing volatility and uncertainty prevalent across many sectors, businesses continue to face tightening credit conditions and limited liquidity. Financial institutions have toughened their positions, both in existing exposures and when making new facilities available. Under these conditions many companies were forced to restructure their loan facilities in an attempt to rectify existing issues with their facilities or in preparing for a tougher year ahead.
Approximately 60% of the container vessel owners covered by our analysis have reported restructuring of their loan obligations during 2010. The corresponding percentage for the dry bulk sector was 29% and for the tanker sector 12%. But significantly less owners foresee debt restructuring in 2011.
Second hand vessel sale & purchase activity was significantly lower in 2010 than in 2009. The number of reported sales was down by close to 20% compared to 2009. Vessel values were under pressure reflecting a weaker freight market, an increasing concern about the order book and in general a large number of potential sales candidates. The survey results demonstrate that asset impairments are at lower levels in 2010 compared to 2009 in most sectors, but especially in the dry bulk and tanker sectors. The container sector reported the largest share of impairments on vessels in 2010, with 42% of the companies incurring impairment losses.
Our analysis shows clearly lower levels of shipbuilding cancellations in 2010 compared to 2009. Especially in the dry bulk sector there was a dramatic reduction of vessel cancellations among the companies we have covered. The reduced shipbuilding cancellations were accompanied with a resumption of ordering activity. This may have been the result increasing cargo demand, the firming of freight rates and low newbuilding prices. Especially for the dry bulk sector the number of orders for new vessels increased two-fold. This trend is expected to change in 2011 as the lower growth in world trade and the increase newbuilding deliveries is likely to divert ship owners’ interest to other subsectors such as gas (LPG or LNG) carriers.
According to our analysis, the newbuilding ratio (calculated as the number of vessels on order divided by the number of vessels operated for all companies in our sample) stands at 25% for dry bulk vessels, 7% for tankers and 10% for containerships. However, these newbuilding ratios are significantly lower than those for the whole shipping market. We believe this is reflective of the fact that most of the companies in our sample are listed and, being accountable to a number of shareholders in the public markets, tend to follow more conservative strategies, while private companies have more risk tolerance and tend to take a more aggressive view of the market.
Finally, scrapping activity declined in 2010, despite very strong scrap prices and relatively weak hire rates. Looking at the dry bulk sector, scrapping activity was negligible in the second half of 2010. However, this trend is likely to change as the container and tanker sectors are under severe pressure from freight rates that declined to levels close to or below operating break-even levels and scrap prices remaining at attractive levels.
Source: PriceWaterHouseCoopers / Hellenic Shipping
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Wednesday, 26 October 11
INDIAN MARKET WAS REMAINED TIGHT THE WHOLE LAST WEEK - BRS
The market once more seems to be at a crossroads. The indices last week remained fairly stable (except for the Panamax sector), ending the week as f ...
Tuesday, 25 October 11
DRY BULK MARKET STEADY, ANALYSTS LOOKING FOR ADDED PRESSURE ON THE MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market was unchanged on Monday, with the industry’s benchmark, the BDI (Baltic Dry Index) ending the session at 2,153 points, exa ...
Monday, 24 October 11
NEW HEAD OF INDONESIA'S MINING MINISTRY GETS RAKED OVER THE COALS - JOSEPH KIRSCHKE
COALspot.com - Following Indonesia’s presidential cabinet shakeup last week, many are questioning the qualifications of Energy and Mineral Res ...
Monday, 24 October 11
CHINA QINHUANGDAO COAL PRICE RISES TO HIGHEST IN THREE YEARS - BUSINESSWEEK
Business week reported that, China’s power-station coal price rose to the highest level in three years as power stations and central heating p ...
Monday, 24 October 11
CAPESIZE RENTAL RATES RISE FOR THIRD DAY AS MORE SHIPS HIRED - HELLENIC SHIPPING
Rates to hire capesize vessels advanced for a third day on signs of increased demand to transport iron ore, used to make steel.Daily rates for the s ...
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- Banpu Public Company Limited - Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- VISA Power Limited - India
- Jindal Steel & Power Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Energy Link Ltd, New Zealand
- Agrawal Coal Company - India
- Star Paper Mills Limited - India
- PTC India Limited - India
- Kaltim Prima Coal - Indonesia
- Economic Council, Georgia
- Mjunction Services Limited - India
- Dalmia Cement Bharat India
- Pipit Mutiara Jaya. PT, Indonesia
- SMG Consultants - Indonesia
- Medco Energi Mining Internasional
- Borneo Indobara - Indonesia
- PNOC Exploration Corporation - Philippines
- Georgia Ports Authority, United States
- CNBM International Corporation - China
- Rashtriya Ispat Nigam Limited - India
- Edison Trading Spa - Italy
- Global Green Power PLC Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- GVK Power & Infra Limited - India
- LBH Netherlands Bv - Netherlands
- Jaiprakash Power Ventures ltd
- CIMB Investment Bank - Malaysia
- Neyveli Lignite Corporation Ltd, - India
- Merrill Lynch Commodities Europe
- Madhucon Powers Ltd - India
- Bhushan Steel Limited - India
- ICICI Bank Limited - India
- Minerals Council of Australia
- Electricity Generating Authority of Thailand
- Kartika Selabumi Mining - Indonesia
- Kideco Jaya Agung - Indonesia
- Eastern Energy - Thailand
- Iligan Light & Power Inc, Philippines
- Independent Power Producers Association of India
- Ministry of Mines - Canada
- SMC Global Power, Philippines
- Indo Tambangraya Megah - Indonesia
- Videocon Industries ltd - India
- Ceylon Electricity Board - Sri Lanka
- Kobexindo Tractors - Indoneisa
- Ambuja Cements Ltd - India
- Price Waterhouse Coopers - Russia
- Bukit Asam (Persero) Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- Marubeni Corporation - India
- Billiton Holdings Pty Ltd - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ministry of Finance - Indonesia
- Altura Mining Limited, Indonesia
- Semirara Mining Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Sarangani Energy Corporation, Philippines
- Rio Tinto Coal - Australia
- Aboitiz Power Corporation - Philippines
- MS Steel International - UAE
- Meralco Power Generation, Philippines
- PowerSource Philippines DevCo
- Global Coal Blending Company Limited - Australia
- Alfred C Toepfer International GmbH - Germany
- Intertek Mineral Services - Indonesia
- Tata Chemicals Ltd - India
- Australian Commodity Traders Exchange
- Electricity Authority, New Zealand
- Indian Oil Corporation Limited
- The University of Queensland
- Interocean Group of Companies - India
- GAC Shipping (India) Pvt Ltd
- Maheswari Brothers Coal Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhatia International Limited - India
- Bayan Resources Tbk. - Indonesia
- New Zealand Coal & Carbon
- Baramulti Group, Indonesia
- Coal and Oil Company - UAE
- Globalindo Alam Lestari - Indonesia
- Coalindo Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Energy Development Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Anglo American - United Kingdom
- Siam City Cement - Thailand
- Carbofer General Trading SA - India
- Toyota Tsusho Corporation, Japan
- Trasteel International SA, Italy
- Central Java Power - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- IEA Clean Coal Centre - UK
- Binh Thuan Hamico - Vietnam
- Miang Besar Coal Terminal - Indonesia
- Goldman Sachs - Singapore
- Vizag Seaport Private Limited - India
- Renaissance Capital - South Africa
- Singapore Mercantile Exchange
- Sindya Power Generating Company Private Ltd
- Leighton Contractors Pty Ltd - Australia
- European Bulk Services B.V. - Netherlands
- Parliament of New Zealand
- Bharathi Cement Corporation - India
- Parry Sugars Refinery, India
- Indonesian Coal Mining Association
- Indian Energy Exchange, India
- The Treasury - Australian Government
- ASAPP Information Group - India
- PetroVietnam Power Coal Import and Supply Company
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- International Coal Ventures Pvt Ltd - India
- Bangladesh Power Developement Board
- Indogreen Group - Indonesia
- Simpson Spence & Young - Indonesia
- Sical Logistics Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Karaikal Port Pvt Ltd - India
- Malabar Cements Ltd - India
- Grasim Industreis Ltd - India
- Lanco Infratech Ltd - India
- Latin American Coal - Colombia
- Karbindo Abesyapradhi - Indoneisa
- Asmin Koalindo Tuhup - Indonesia
- Directorate Of Revenue Intelligence - India
- Bulk Trading Sa - Switzerland
- Attock Cement Pakistan Limited
- Orica Australia Pty. Ltd.
- Aditya Birla Group - India
- Mercator Lines Limited - India
- Chamber of Mines of South Africa
- Romanian Commodities Exchange
- Heidelberg Cement - Germany
- The State Trading Corporation of India Ltd
- Manunggal Multi Energi - Indonesia
- Tamil Nadu electricity Board
- Krishnapatnam Port Company Ltd. - India
- Maharashtra Electricity Regulatory Commission - India
- Bukit Makmur.PT - Indonesia
- Standard Chartered Bank - UAE
- Barasentosa Lestari - Indonesia
- San Jose City I Power Corp, Philippines
- Vedanta Resources Plc - India
- Kumho Petrochemical, South Korea
- Essar Steel Hazira Ltd - India
- Global Business Power Corporation, Philippines
- Port Waratah Coal Services - Australia
- Oldendorff Carriers - Singapore
- Makarim & Taira - Indonesia
- Central Electricity Authority - India
- Commonwealth Bank - Australia
- Wood Mackenzie - Singapore
- Riau Bara Harum - Indonesia
- India Bulls Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Siam City Cement PLC, Thailand
- AsiaOL BioFuels Corp., Philippines
- Directorate General of MIneral and Coal - Indonesia
- Uttam Galva Steels Limited - India
- OPG Power Generation Pvt Ltd - India
- Thiess Contractors Indonesia
- Deloitte Consulting - India
- Sree Jayajothi Cements Limited - India
- Larsen & Toubro Limited - India
- Pendopo Energi Batubara - Indonesia
- Sojitz Corporation - Japan
- White Energy Company Limited
- TeaM Sual Corporation - Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Mercuria Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Sakthi Sugars Limited - India
- South Luzon Thermal Energy Corporation
- Kalimantan Lumbung Energi - Indonesia
- Therma Luzon, Inc, Philippines
- Samtan Co., Ltd - South Korea
- Mintek Dendrill Indonesia
- Power Finance Corporation Ltd., India
- SN Aboitiz Power Inc, Philippines
- Coastal Gujarat Power Limited - India
- Kepco SPC Power Corporation, Philippines
- Savvy Resources Ltd - HongKong
- IHS Mccloskey Coal Group - USA
- Bukit Baiduri Energy - Indonesia
- GMR Energy Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Petron Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Indika Energy - Indonesia
- McConnell Dowell - Australia
- London Commodity Brokers - England
- Wilmar Investment Holdings
- Semirara Mining and Power Corporation, Philippines
- Ministry of Transport, Egypt
- Antam Resourcindo - Indonesia
- Metalloyd Limited - United Kingdom
- Gujarat Sidhee Cement - India
- Australian Coal Association
- Timah Investasi Mineral - Indoneisa
- Cement Manufacturers Association - India
- Posco Energy - South Korea
- Offshore Bulk Terminal Pte Ltd, Singapore
- Eastern Coal Council - USA
- Orica Mining Services - Indonesia
- Thai Mozambique Logistica
- Bank of Tokyo Mitsubishi UFJ Ltd
- Planning Commission, India
- Africa Commodities Group - South Africa
- Salva Resources Pvt Ltd - India
- Xindia Steels Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Meenaskhi Energy Private Limited - India
- Chettinad Cement Corporation Ltd - India
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