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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, 12 October 11
CAPESIZE - A SURPRISE JUMP IN RATES - BRS
There was a surge across all sizes last week, resulting in the BDI gaining 101 points to end the week at 2,000 points (+5.3%). The BCI reached 3,218 ...
Wednesday, 12 October 11
CAPESIZE FREIGHT RATES BOUND TO RETREAT FROM 2011 HIGHS ON THE BACK OF TONNAGE OVERSUPPLY SAYS BIMCO
According to Nikos Roussanoglou, Hellenic Shipping, with the BDI (Baltic Dry Index) breaking yet another 2011 high yesterday and ending the se ...
Tuesday, 11 October 11
GLENCORE, SUITOR FOR BUMI PLC? - INSIDER STORIES
Insider Stories reported that, the largest commodities trader in the world, Glencore International Plc, is considering an opportunity to acquire a m ...
Tuesday, 11 October 11
RENUKA COALINDO BUYS JAMBI COAL
PT Renuka Coalindo Tbk, formerly PT Allbond Makmur Usaha Tbk plans to acquire PT Jambi Prima Coal holder of mining concession in Pauh, Sa ...
Monday, 10 October 11
MOZAMBIQUE CHANNEL TO BE THE NEW PIRACY HOTSPOT FOR THIS YEAR SAYS MARITIME SECURITY EXPERT - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The Mozambique Channel, as well as the entrance to the Persian Gulf, are expected to become some of the new pirate hotspots for piracy, says Richard ...
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- Madhucon Powers Ltd - India
- San Jose City I Power Corp, Philippines
- Alfred C Toepfer International GmbH - Germany
- Uttam Galva Steels Limited - India
- Trasteel International SA, Italy
- Metalloyd Limited - United Kingdom
- Dalmia Cement Bharat India
- Star Paper Mills Limited - India
- IHS Mccloskey Coal Group - USA
- Thai Mozambique Logistica
- Africa Commodities Group - South Africa
- Gujarat Electricity Regulatory Commission - India
- White Energy Company Limited
- Asmin Koalindo Tuhup - Indonesia
- London Commodity Brokers - England
- Bharathi Cement Corporation - India
- Aboitiz Power Corporation - Philippines
- GMR Energy Limited - India
- Pendopo Energi Batubara - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Power Finance Corporation Ltd., India
- Formosa Plastics Group - Taiwan
- CIMB Investment Bank - Malaysia
- Price Waterhouse Coopers - Russia
- PowerSource Philippines DevCo
- Kapuas Tunggal Persada - Indonesia
- Australian Coal Association
- Vizag Seaport Private Limited - India
- Petron Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Kideco Jaya Agung - Indonesia
- Latin American Coal - Colombia
- Orica Mining Services - Indonesia
- Heidelberg Cement - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Toyota Tsusho Corporation, Japan
- Therma Luzon, Inc, Philippines
- Ministry of Mines - Canada
- PetroVietnam Power Coal Import and Supply Company
- MS Steel International - UAE
- Sindya Power Generating Company Private Ltd
- Iligan Light & Power Inc, Philippines
- Ministry of Finance - Indonesia
- Deloitte Consulting - India
- Chettinad Cement Corporation Ltd - India
- Semirara Mining and Power Corporation, Philippines
- The University of Queensland
- Merrill Lynch Commodities Europe
- Goldman Sachs - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Commonwealth Bank - Australia
- Indogreen Group - Indonesia
- Aditya Birla Group - India
- Bulk Trading Sa - Switzerland
- The State Trading Corporation of India Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMG Consultants - Indonesia
- SMC Global Power, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Mercator Lines Limited - India
- Carbofer General Trading SA - India
- Pipit Mutiara Jaya. PT, Indonesia
- VISA Power Limited - India
- Barasentosa Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Straits Asia Resources Limited - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Edison Trading Spa - Italy
- Siam City Cement - Thailand
- Medco Energi Mining Internasional
- Ind-Barath Power Infra Limited - India
- Economic Council, Georgia
- Intertek Mineral Services - Indonesia
- Altura Mining Limited, Indonesia
- Kartika Selabumi Mining - Indonesia
- Coal and Oil Company - UAE
- Independent Power Producers Association of India
- Kalimantan Lumbung Energi - Indonesia
- Bayan Resources Tbk. - Indonesia
- Antam Resourcindo - Indonesia
- Siam City Cement PLC, Thailand
- Billiton Holdings Pty Ltd - Australia
- Sinarmas Energy and Mining - Indonesia
- PNOC Exploration Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- Electricity Authority, New Zealand
- Coastal Gujarat Power Limited - India
- Agrawal Coal Company - India
- Banpu Public Company Limited - Thailand
- GVK Power & Infra Limited - India
- Mercuria Energy - Indonesia
- Wood Mackenzie - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Wilmar Investment Holdings
- Parry Sugars Refinery, India
- Bukit Makmur.PT - Indonesia
- Planning Commission, India
- Mjunction Services Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sarangani Energy Corporation, Philippines
- Marubeni Corporation - India
- Sakthi Sugars Limited - India
- Renaissance Capital - South Africa
- Videocon Industries ltd - India
- Indian Oil Corporation Limited
- PTC India Limited - India
- Ministry of Transport, Egypt
- Global Coal Blending Company Limited - Australia
- Thiess Contractors Indonesia
- Bangladesh Power Developement Board
- Kumho Petrochemical, South Korea
- Coalindo Energy - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Parliament of New Zealand
- Sree Jayajothi Cements Limited - India
- Oldendorff Carriers - Singapore
- Energy Link Ltd, New Zealand
- Chamber of Mines of South Africa
- Maheswari Brothers Coal Limited - India
- ICICI Bank Limited - India
- Sojitz Corporation - Japan
- Krishnapatnam Port Company Ltd. - India
- Grasim Industreis Ltd - India
- Essar Steel Hazira Ltd - India
- Manunggal Multi Energi - Indonesia
- Samtan Co., Ltd - South Korea
- India Bulls Power Limited - India
- Simpson Spence & Young - Indonesia
- New Zealand Coal & Carbon
- CNBM International Corporation - China
- Leighton Contractors Pty Ltd - Australia
- OPG Power Generation Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Port Waratah Coal Services - Australia
- Tamil Nadu electricity Board
- Gujarat Sidhee Cement - India
- ASAPP Information Group - India
- SN Aboitiz Power Inc, Philippines
- Indian Energy Exchange, India
- Karbindo Abesyapradhi - Indoneisa
- Orica Australia Pty. Ltd.
- Central Electricity Authority - India
- Mintek Dendrill Indonesia
- Bukit Baiduri Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Makarim & Taira - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Georgia Ports Authority, United States
- Bhushan Steel Limited - India
- Posco Energy - South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Rashtriya Ispat Nigam Limited - India
- South Luzon Thermal Energy Corporation
- Petrochimia International Co. Ltd.- Taiwan
- Timah Investasi Mineral - Indoneisa
- Electricity Generating Authority of Thailand
- Vedanta Resources Plc - India
- European Bulk Services B.V. - Netherlands
- Global Business Power Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Lanco Infratech Ltd - India
- Binh Thuan Hamico - Vietnam
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Salva Resources Pvt Ltd - India
- McConnell Dowell - Australia
- Anglo American - United Kingdom
- Interocean Group of Companies - India
- Bhatia International Limited - India
- Rio Tinto Coal - Australia
- Globalindo Alam Lestari - Indonesia
- Malabar Cements Ltd - India
- Bhoruka Overseas - Indonesia
- Attock Cement Pakistan Limited
- Kaltim Prima Coal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indonesian Coal Mining Association
- Holcim Trading Pte Ltd - Singapore
- Riau Bara Harum - Indonesia
- Eastern Coal Council - USA
- GN Power Mariveles Coal Plant, Philippines
- IEA Clean Coal Centre - UK
- Ceylon Electricity Board - Sri Lanka
- Indika Energy - Indonesia
- Romanian Commodities Exchange
- Indo Tambangraya Megah - Indonesia
- Central Java Power - Indonesia
- Tata Chemicals Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Cement Manufacturers Association - India
- Sical Logistics Limited - India
- Directorate Of Revenue Intelligence - India
- Minerals Council of Australia
- Standard Chartered Bank - UAE
- Australian Commodity Traders Exchange
- Ambuja Cements Ltd - India
- Cigading International Bulk Terminal - Indonesia
- TeaM Sual Corporation - Philippines
- Semirara Mining Corp, Philippines
- Baramulti Group, Indonesia
- Meralco Power Generation, Philippines
- Xindia Steels Limited - India
- Singapore Mercantile Exchange
- Energy Development Corp, Philippines
- Larsen & Toubro Limited - India
- Eastern Energy - Thailand
- Jindal Steel & Power Ltd - India
- The Treasury - Australian Government
- Jaiprakash Power Ventures ltd
- Karaikal Port Pvt Ltd - India
- Borneo Indobara - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
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