Harland & Wolff Group temporarily suspends shares pending audited financial statements

Belfast shipyard Harland & Wolff Group (H&W) has temporarily suspended trading in its shares as the business was not able to publish its audited financial statements and annual report on or before July 1 2024.

H&W said it has been in extensive discussions with its auditors to agree on the method of accounting for revenues throughout the duration of a build programme. In unaudited results it was able to publish this morning, losses had narrowed at the historic business on revenue which soared up close to £90m.

H&W said the assessment of the split in revenues between current year's revenues and deferred revenues has caused a delay to the audit process and hence delays to the publication of the 2023 annual report.

However, as the firm and its auditors have recently agreed the treatment of revenues in the financial statements, H&W is able to publish its unaudited preliminary results for 2023 today (July 1 2024). The company will now progress to complete the audit quickly and expects to publish its 2023 annual report during the week commencing July 8 2024.

While the company expects to make some adjustments to the final audited numbers, these changes are not expected to be material.

In the unaudited accounts for the year to December 31 2023, H&W's revenues grew to £86.9m, a 213% increase over its FY22 revenues of £27.75m.

The company was also able to reduce its operating loss in FY by 136% to £24.7m. H&W's interest burden, however, increased from £12.3m in FY22 to £18.4m n FY23.A credit facility with Riverstone Credit Partners was upsized and stood at $115m at the end of June 2024.

As previously announced, H&W has been in discussions with UK Export Finance since Q3 22 for a proposed £200m facility.

Further work continues on this facility, H&W said, and the company expects UK Government to reach a decision after the General Election.

However H&W warned that "should there be any material delays to securing the facility post the general election, the company's ability to execute new and large contracts would be adversely affected".

Since securing the FSS Subcontract in February 2023, H&W has been actively engaged in the programme's regeneration plan.

Accordingly, the company has placed orders for several major CAPEX items, including but not limited to, one of Europe's largest robotic welding panel lines, plasma cutters and transporters. in addition to commencing construction works to expand Belfast's fabrication halls.

Work continues in relation to the procurement of long lead and critical path equipment for the three vessels.

H&W added that its yards have been busy through the year with multiple contracts being fulfilled and the business continues to increase its core personnel in preparation for first cut of steel for the FSS programme in Q1 25.

As at December 31 2023, the group headcount was 1,010 personnel which has now gone up to 1,512 with an increase in work undertaken in all the yards.

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