Garware Offshore expects good number in future quarters

Below is the verbatim transcript of the interview. Also watch the accompanying video.

Q: Can you give us your numbers?

A: For the quarter ended March 2011, we have done a total charter earning income of Rs 41 crore and profit after tax (PAT) of Rs 5.9 crore. There was a loss of other operating income of around Rs 2.3 crore. This was mainly because during the quarter, the company sold one of its vessels MV Mana and prepaid the debt on that vessel.

The prepayment of the debt has led to the forex loss, as per Accounting Standard 30, we have to account for realised gain or loss in that particular quarter.

However, the company earns in dollars and the sales realisation and debt were in dollars, so on a cash flow basis, there was no effect on the company’s results.

Q: Will this be a trend? Will your profits and revenues be under pressure in the coming quarter or the current quarter as well, since you have sold off a ship?

A: It will not come under pressure because this vessel was sold to a company in Singapore. Thereafter, the vessel has been taken on bareboat charter in the Singapore subsidiary.

We currently have three vessels on bareboat charter in Singapore subsidiary. We have added asset in December in our subsidiary in Netherlands has got a contract with Petrobras in Brazil, which will add to the revenues. On a consolidated basis, the numbers should be good in coming quarters.

Q: Do you have any more asset sales planned in the forthcoming quarters? If you can give us a hang of derates currently? Do you expect any improvement going forward?

A: Currently, all our assets are on terms charter. There won’t be any change in the day rates as far as current term charter is concerned. Going forward, we do have plans for expansion.

Once this asset goes to work in Petrobras in Brazil, we do have plans to add one-two more assets in the same segment that is large platform supply vessel (PSV). The capex would be in the region of around USD 100-110 million for both the assets put together.