Austal posts jump in first half profit

Shipbuilder Austal has posted a first half-profit of $9.5 million as it continues its three major vessel contracts.

As The West Australian reports, the company’s profit jumped by 76 per cent in the six months to December 31 and revenue for the period increased by 30.4 per cent to $507.6 million.

In addition, Austal reduced its net debt to $113.7 million (a decrease of $32.8 million).

As The Business Spectator reports, the group said net profit after tax was improved by $2.3 million because of the sale of the Henderson service facility. However, it was also negatively impacted by the writedown of work in progress by $7.2 million.

"Thirteen vessels were under construction at our US and Australia shipyards in the half, with those ships bolstering the value of Austal's work in progress to a record amount," Austal Chief executive Andrew Bellamy said.

"Through a combination of the lessons learnt from the first-in-class vessels for each of those ship programs, the operational efficiencies we have implemented, and the management structures and systems we have put in place, we have been able to deliver revenue growth and strong cash flow from this record amount.

"Importantly, we utilised the cash generated to reduce our debt, further strengthening our balance sheet that will better position the company to deliver ongoing returns to shareholders."

He added that, given that the company reached about half its forecast revenue in the first half, Austal is confidant of meeting its forecast of $1 billion revenue this year.

Austal shares closed flat at 88 cents. The group declined to pay a dividend.