Austal confirms FY23 loss on US steel shipbuilding

International shipbuilder Austal has confirmed a NPAT loss for FY23 of $13.6 million, down from a profit of $79.6 million the previous year.

The loss, set on revenue up 11 percent to $1.59 billion, is due to provisional losses of $171 million stemming from the construction of steel hulled Navajo class Towing, Salvage, and Rescue (T-ATS) Ships in the United States.

While the company continues to its Requests for Equitable Adjustment of the contract value, recovery is uncertain at this point.

EBITDA profit for the year was $55 million, down from $165.4 million, driven by strong results in the company’s naval shipbuilding businesses and rising revenues from its maintenance and support arms. The order book stood at up to $11.6 billion at year’s end.

Chief Executive Officer Paddy Gregg said: “We are focused on getting the T-ATS construction programme back on track while methodically building a diversified, sustainable, recurrent and earnings-accretive revenue stream via the support business, which sets us up very well for the medium to long-term.

“Our positive outlook is underpinned by the award of key steel programmes in the USA during FY23.”

In the past year the company was awarded new contracts to construct Offshore Patrol Cutters and Auxiliary General Ocean Surveillance Ships.

“Backed by the learnings we are taking from the T-ATS programme, which was our first steel programme in our newly commissioned US facility, in addition to the robust cost escalation protections for the recent major US steel project awards, we are well placed to secure and execute our record pipeline of work profitably.”

Austal is looking less healthy in terms of construction of its aluminium multi-hulled fast ferries in Australia, Vietnam and the Philippines.

The global market is weak and the SE Asian yards have yet to win new orders following the completion of major commercial ferry programmes.

Further reading:
Austal shares plunge on steel shipbuilding woes
Austal wins sixth US Navy contract for towage vessels
Browse @AuManufacturing’s coverage of Austal here.

Picture: Austal