Essar Shipping profit jumps 43%
Essar Shipping profit jumps 43%
Mumbai: Long-term contracts and offshore revenue have helped Essar Shipping Ltd to post a 43% increase in quarterly profit.
A.R. Ramakrishnan, managing director at Essar Shipping, said the increases were possible because of the company’s decision to enter into long-term charters of vessels as that provides a natural hedge against the cyclical nature of the industry and ensures long-term visibility of revenue and profitability.
Revenue from offshore services increased 56.9% to Rs143.9 crore.
Essar Wildcat, the company’s offshore drilling rig, is deployed under an 18-month contract with US refiner ConocoPhillips Co. starting September 2011 at a day rate of $285,000. Most of Essar Shipping’s fleet are on long-term contracts with minimal exposure to spot markets. The company owns 25 vessels.
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