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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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Saturday, 26 November 11
THE FREIGHT MARKETS EXPECTED TO BE STEADY NEXT WEEK - VISTAAR
COALspot.com - The market were down probably with the sentiments of global financial markets and all segments were down.
The BDI was up down by 4 ...
Friday, 25 November 11
DISPUTE BETWEEN GIANT MINING FIRMS ENDS IN LAHAT - THE JAKARTA POST
The Jakarta Post reported that, prolonged dispute taking place in the South Sumatra regency of Lahat and involving two giant mining companies PT Buk ...
Friday, 25 November 11
DRY BULK MARKET LOSING STEAM, FAST - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
It’s been a week of falls for the dry bulk market this one, leaving ship owners with a sour taste in their mouths, as evidence of a recovery i ...
Thursday, 24 November 11
INDONESIA/INDIA SPMX TC AROUND $ 7/8K AND AROUND $ 12/13.00 PMTS ON VOYAGE BASIS - FEARNLEYS
Handy
Last week ended on a positive note in the Atlantic however the activity levels are somewhat reduced. Owners are asking in excess of USD ...
Thursday, 24 November 11
DRY BULK MARKET KEEPS LOSING STEAM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market was lower once again on Wednesday, with the industry’s benchmark, the Baltic Dry Index (BDI) ending the session down by 1. ...
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- Xindia Steels Limited - India
- Kumho Petrochemical, South Korea
- Indo Tambangraya Megah - Indonesia
- Coal and Oil Company - UAE
- MS Steel International - UAE
- Deloitte Consulting - India
- Sarangani Energy Corporation, Philippines
- Bhushan Steel Limited - India
- Orica Australia Pty. Ltd.
- Medco Energi Mining Internasional
- Rashtriya Ispat Nigam Limited - India
- PNOC Exploration Corporation - Philippines
- VISA Power Limited - India
- Karaikal Port Pvt Ltd - India
- Indonesian Coal Mining Association
- Rio Tinto Coal - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Business Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Australian Coal Association
- Videocon Industries ltd - India
- GAC Shipping (India) Pvt Ltd
- Thai Mozambique Logistica
- Tamil Nadu electricity Board
- ICICI Bank Limited - India
- Straits Asia Resources Limited - Singapore
- Sical Logistics Limited - India
- Leighton Contractors Pty Ltd - Australia
- Metalloyd Limited - United Kingdom
- Chamber of Mines of South Africa
- Therma Luzon, Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Timah Investasi Mineral - Indoneisa
- PowerSource Philippines DevCo
- Semirara Mining Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Grasim Industreis Ltd - India
- New Zealand Coal & Carbon
- AsiaOL BioFuels Corp., Philippines
- Indian Energy Exchange, India
- Manunggal Multi Energi - Indonesia
- Energy Link Ltd, New Zealand
- Salva Resources Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Wilmar Investment Holdings
- Intertek Mineral Services - Indonesia
- Kaltim Prima Coal - Indonesia
- Jindal Steel & Power Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Electricity Regulatory Commission - India
- Aditya Birla Group - India
- Bayan Resources Tbk. - Indonesia
- Riau Bara Harum - Indonesia
- Binh Thuan Hamico - Vietnam
- Africa Commodities Group - South Africa
- Malabar Cements Ltd - India
- Pendopo Energi Batubara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Aboitiz Power Corporation - Philippines
- Siam City Cement PLC, Thailand
- Goldman Sachs - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Baramulti Group, Indonesia
- Planning Commission, India
- London Commodity Brokers - England
- Meenaskhi Energy Private Limited - India
- Latin American Coal - Colombia
- Star Paper Mills Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Carbofer General Trading SA - India
- The Treasury - Australian Government
- Samtan Co., Ltd - South Korea
- Savvy Resources Ltd - HongKong
- Bharathi Cement Corporation - India
- Uttam Galva Steels Limited - India
- Minerals Council of Australia
- McConnell Dowell - Australia
- Alfred C Toepfer International GmbH - Germany
- Krishnapatnam Port Company Ltd. - India
- IHS Mccloskey Coal Group - USA
- Marubeni Corporation - India
- Kideco Jaya Agung - Indonesia
- Orica Mining Services - Indonesia
- Sojitz Corporation - Japan
- Power Finance Corporation Ltd., India
- Oldendorff Carriers - Singapore
- Bukit Baiduri Energy - Indonesia
- Trasteel International SA, Italy
- Energy Development Corp, Philippines
- Altura Mining Limited, Indonesia
- Merrill Lynch Commodities Europe
- Gujarat Sidhee Cement - India
- Cement Manufacturers Association - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bahari Cakrawala Sebuku - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- SMG Consultants - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Madhucon Powers Ltd - India
- Sree Jayajothi Cements Limited - India
- Ministry of Mines - Canada
- Jorong Barutama Greston.PT - Indonesia
- Kartika Selabumi Mining - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Standard Chartered Bank - UAE
- Posco Energy - South Korea
- The State Trading Corporation of India Ltd
- SMC Global Power, Philippines
- Bulk Trading Sa - Switzerland
- GMR Energy Limited - India
- Price Waterhouse Coopers - Russia
- Barasentosa Lestari - Indonesia
- Electricity Authority, New Zealand
- Edison Trading Spa - Italy
- CNBM International Corporation - China
- Thiess Contractors Indonesia
- Port Waratah Coal Services - Australia
- European Bulk Services B.V. - Netherlands
- Kapuas Tunggal Persada - Indonesia
- Parry Sugars Refinery, India
- Agrawal Coal Company - India
- Parliament of New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Attock Cement Pakistan Limited
- White Energy Company Limited
- Bhoruka Overseas - Indonesia
- Indogreen Group - Indonesia
- Eastern Coal Council - USA
- Ind-Barath Power Infra Limited - India
- Anglo American - United Kingdom
- Pipit Mutiara Jaya. PT, Indonesia
- Meralco Power Generation, Philippines
- Electricity Generating Authority of Thailand
- ASAPP Information Group - India
- Heidelberg Cement - Germany
- International Coal Ventures Pvt Ltd - India
- Larsen & Toubro Limited - India
- Indian Oil Corporation Limited
- San Jose City I Power Corp, Philippines
- Ministry of Transport, Egypt
- SN Aboitiz Power Inc, Philippines
- Formosa Plastics Group - Taiwan
- Jaiprakash Power Ventures ltd
- South Luzon Thermal Energy Corporation
- Interocean Group of Companies - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Coalindo Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Borneo Indobara - Indonesia
- TeaM Sual Corporation - Philippines
- Mjunction Services Limited - India
- GVK Power & Infra Limited - India
- Billiton Holdings Pty Ltd - Australia
- Dalmia Cement Bharat India
- Maharashtra Electricity Regulatory Commission - India
- Central Java Power - Indonesia
- Chettinad Cement Corporation Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Central Electricity Authority - India
- Sindya Power Generating Company Private Ltd
- Singapore Mercantile Exchange
- Renaissance Capital - South Africa
- Antam Resourcindo - Indonesia
- Bangladesh Power Developement Board
- Lanco Infratech Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Mercuria Energy - Indonesia
- India Bulls Power Limited - India
- Makarim & Taira - Indonesia
- Bukit Makmur.PT - Indonesia
- Banpu Public Company Limited - Thailand
- IEA Clean Coal Centre - UK
- Sakthi Sugars Limited - India
- Mercator Lines Limited - India
- Directorate General of MIneral and Coal - Indonesia
- LBH Netherlands Bv - Netherlands
- Mintek Dendrill Indonesia
- Kepco SPC Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Miang Besar Coal Terminal - Indonesia
- CIMB Investment Bank - Malaysia
- Ministry of Finance - Indonesia
- Australian Commodity Traders Exchange
- Economic Council, Georgia
- Vedanta Resources Plc - India
- Georgia Ports Authority, United States
- Eastern Energy - Thailand
- Maheswari Brothers Coal Limited - India
- Romanian Commodities Exchange
- Global Green Power PLC Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Siam City Cement - Thailand
- The University of Queensland
- Petron Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Bhatia International Limited - India
- PTC India Limited - India
- Independent Power Producers Association of India
- Coastal Gujarat Power Limited - India
- Tata Chemicals Ltd - India
- Indika Energy - Indonesia
- Commonwealth Bank - Australia
- Directorate Of Revenue Intelligence - India
- Cigading International Bulk Terminal - Indonesia
- Global Coal Blending Company Limited - Australia
- Simpson Spence & Young - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Wood Mackenzie - Singapore
- Vizag Seaport Private Limited - India
- Toyota Tsusho Corporation, Japan
- Ambuja Cements Ltd - India
- Gujarat Mineral Development Corp Ltd - India
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