Mumbai: Great Eastern Shipping Co Ltd’s quarterly net profit plunged 68% as freight rates slumped during the quarter, putting pressure on margins, a senior official said on Friday.
The company posted a net profit of Rs94.39 crore for the quarter-ended December 2009, compared with Rs290 crore a year ago, while total income fell nearly 29% to Rs708 crore.
“We have posted the lowest profit in six years,” chief financial officer G Shivakumar said on an earnings conference call.
“We have seen a huge drop in rates from corresponding quarter of last year. Tanker market was strong last year but has turned weak now. That reflected on our results,” he added.
Earnings from crude carriers and product carriers have slipped 70%, he added.
The company also had a loss of Rs36.70 crore on foreign currency transactions and a marked-to-market loss of Rs18 crore on interest rates swaps in its offshore unit, Shivakumar said.
However, it expects better earnings from the offshore unit, going forward, on higher oil prices and earnings from its jack-up rigs, managing director Bharat Sheth said on the call.
Oil prices have jumped by three-fourths over the past 52 weeks as the global economy has shown signs of a steady recovery.
“Jack-up rigs are contributing good numbers. Some of the boats which are in spot market with very poor utilization will get covered. In the next couple of weeks we should get some outcome,” he said.
Shares in the firm ended up 0.88% at Rs285.3 in the stockmarket, which ended up 0.31%.