Austal posted a full year loss of $84.28 million because a program to build war ships for the US Navy took longer than expected.
Revenue at Australia’s largest shipbuilder fell 5.3% to $1.34 billion. The EBIT (earnings before interest and taxes) loss of $120.9 million, compared to a $85.3 million EBIT profit in 2015, was within new guidance issued last month.
Austal shares last traded at $1.17, down from a 12 month high of $2.56 but well above a low of 93 cents.
CEO David Singleton says the outlook is positive despite the 2016 bigger costs on the Littoral Combat Ship (LCS) program.
“The impact of the one-off downward adjustment to the LCS program has had on our earnings this year was disappointing, but Austal still has a strong order book and is generating strong cash flows from its efficient vessel construction,” says Singleton.
He says the $US4 billion ($A5.3 billion) Littoral Combat Ship program will be profitable across its remaining life because the company now has a much clearer understanding of the design required and margins that will be generated.
He says Austal is well placed with an order book of $3.4 billion across its three shipyards, a strong balance sheet, and significant pipeline opportunities for defence and commercial vessels in the US and Australia.
The Perth-based company last month announced a one-off $115 million write back of work in progress on the trimaran program.
The cost of building the Littoral Combat Ships to meet shock rating standards and US Navy rules was a lot more than estimated.
The company today declared a final dividend of 2 cents a share fully franked.
The 2016 results in detail: