Mercator Consolidated Q1 Net at Rs 15 cr

For the first quarter ended 30th June, 2011, Mercator Lines Consolidated Income increased by 33% to Rs.799.27 crores (Rs.602.89 crores) and Consolidated Net Profit to Rs.14.73 crores (Rs.61.70 crores).

The Coal Division accounted for 60% and the Dry Bulk Division contributed 22% to the revenue.  The Tanker, Dredger and Offshore Divisions contributed 10%, 4% and 4% to the revenue respectively.

In the Coal Division, Mercator, through its subsidiary, is concluding the acquisition of one more mining concession in East Kalimantan, Indonesia and production is expected to start from Q4.  This mine has an estimated 45 mln MT of coal reserves. Mercator is also looking to further expand its activities in the coal business.

In the Offshore Division, Mercator successfully commissioned its Floating Production Unit (FPU) in Nigeria, which it has chartered on a nine year contract with LSE listed oil major Afren Plc generating revenues @ US$ 111K per day.  The FPU commenced commercial production from 30th April, 2011 and marks a significant achievement and milestone in Mercator’s history. Mercator is eyeing further opportunities in FPSO and FPU in offshore services area.

Mercator has been awarded the right to explore, develop and produce oil and gas from two onshore blocks in the Cambay basin in Gujarat under NELP VII and is currently carrying out seismic studies.

In the Shipping Division, the earnings were adversely impacted due to global economic slowdown and softening in tanker freight rates in all segments.  Mercator currently operates 21 dry bulk carriers of which 18 are owned and 3 are chartered vessels. 

In the Dredging Division, Mercator has upgraded its dredgers and has a confirmed order book of

INR 300 crores.  To meet its increased capacity requirements, Mercator is looking to acquire three more dredgers during the year valued at about US$ 30 million.