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Aban Offshore Ltd.

BSE: 523204 | NSE: ABAN | Series: NA | ISIN: INE421A01028 | SECTOR: Oil Drilling And Exploration

BSE Live

Jul 02, 15:43
30.05 -1.55 (-4.91%)
Volume
AVERAGE VOLUME
5-Day
74,376
10-Day
64,400
30-Day
34,934
20,699
  • Prev. Close

    31.60

  • Open Price

    30.05

  • Bid Price (Qty.)

    0.00 (0)

  • Offer Price (Qty.)

    30.05 (6527)

NSE Live

Jul 02, 15:59
30.10 -1.55 (-4.90%)
Volume
AVERAGE VOLUME
5-Day
358,705
10-Day
287,204
30-Day
153,491
34,978
  • Prev. Close

    31.65

  • Open Price

    30.10

  • Bid Price (Qty.)

    0.00 (0)

  • Offer Price (Qty.)

    30.10 (7819)

Annual Report

For Year :
2014 2010 2007

Chairman's Speech

Dear Shareholders, The Company reported a 102.74 per cent increase in its profi t after tax from H1,938.73 million in 2012- 13 to H3,930.65 million in 2013-14. Correspondingly, the Company''s cash profi t (profi t after tax plus depreciation) strengthened from H6,967.20 million to H9,246.90 million during the period. At Aban, this improvement was the result of some decisive initiatives in improving its deployment, operational and fi nancial performance. One, the Company successfully deployed almost all its rigs on contract, resulting in a high asset utilisation. Add to this the fact that the Aban Ice commenced on a new contract during the year under review at an enhanced day rate. As most of the contracts are in USD, the depreciation of the Indian rupee against USD during the year resulted in higher revenues in Indian rupee and a correspondingly higher profi t. Tw o , the Company refi nanced its debt for a longer tenure of 15 years, which aligned debt tenures with the long- term nature of the Company''s assets and reduced considerable stress on the Company''s repayment capability and projected cash fl ows. Three, the Company sustained prevailing rates for long-term contracts and capitalised on higher rates where rig contracts were renewed. Four, even as the external currency environment remained volatile, the Company converted all its loans into dollar denomination, progressively emerging as a currency-neutral corporate with revenues also in dollar denomination. This was a significant step in the area of risk management. At Aban, we had foreseen this positive development for various reasons. Rig rates had declined following the 2008 fi nancial crisis and were poised for correction. During the year under review, the Company graduated from legacy to contemporary rates, moved a rig from Iran to other regions with long-term potential, deployed one more rig in Mexico and reinforced its global positioning, with 80 per cent of its revenues derived from international waters as opposed to a decade ago when the reverse scenario prevailed. Operational highlights Rigs Aban III and Aban VI had incident- free operations for a continuous period of six and seven years respectively. Prospects At Aban, we are optimistic of our prospects for a number of pertinent reasons. The high oil realisations have translated into attractive earnings for a number of oil majors, which they have prudently deployed into fresh oil & gas exploration. One of the interesting developments is that some new global exploration frontiers have emerged, widening the market for drilling and rig deployment. East Africa is one such E&P destination where there has been an increase in the demand for oil rigs accompanied by attractive contract tenures and realisations. The global rig market is not just marked by an increased demand for new rigs; it is also marked by a significantly higher demand for new rigs with correspondingly higher realisations. At Aban, we are attractively placed to capitalise on this market divergence on account of an ownership of nine new rigs enjoying a high uptime, low costs, attractive realisations and a relatively young fl eet. The Company continues to lay an emphasis on safety. The Company intends to strengthen its Balance Sheet by refi nancing debt for a longer tenure resulting in a comfortable interest cover. Over the foreseeable future, the Company expects to report an increase in earnings which are not driven as much out of an increase in day rates but by a decline in interest outfl ow, strengthening the Company''s ability to ride through various market cycles and reinforce its long-term sustainability. Warm regards, Reji Abraham, Managing Director