Austal posts 14% drop in revenue

Henderson-based shipbuilder Austal has reported an “expected” decrease in revenue to $722 million for the first half of the 2022 financial year but achieved record earnings.

The company’s earnings before interest and tax (EBIT) was $71.1 million at December 31, a slight increase on the same time in 2020.

Meanwhile, its revenue dipped 14 per cent to $722.4 million due to COVID-19 related impacts on operations, an increased exchange rate, and a maturing LCS (Littoral Combat Ship) construction program.

Austal’s net profit after tax was also down 14 per cent, to $45.1 million.

However, chief executive Paddy Gregg said the company was able to offset the result with increased shipbuilding margins in the US.

“We have delivered our highest interim EBIT figure, bettering the record result in the prior corresponding period despite the expected decrease in revenue,” he said.

“The earnings result affirmed Austal’s ability to continuously enhance our shipbuilding processes to efficiently achieve key milestones and successfully deliver shipbuilding and sustainment programs across our US and Australasia operations.”

Austal has forecast a full-year EBIT of at least $107 million, which Mr Gregg said reflected the company’s confidence in the efficient delivery of its shipbuilding programs.

“There is more upside this year and a strong basis for future years if we secure additional orders, a goal we are intent on achieving,” he added.

Austal expects revenue for the full year will reach $1.4 billion, down from the $1.57 billion it achieved in FY21.

The company ended the half year with about $307 million in cash, down from the $347 million it had at June 30, following “significant enhancing capital investments” of about $74 million.

The board has declared an interim unfranked dividend of 4 cents per share, to be paid in April.

Austal’s shares were down 1.4 per cent at 2:25pm AEDT to trade at $1.92 each.