Business

Harland and Wolff say work recovering at Belfast shipyard despite posting £25.5m loss

The Harland & Wolff shipyard in Belfast. Picture by Mal McCann.

THE new owner of Belfast’s Harland and Wolff shipyard has said its business is improving after announcing a pre-tax loss of £25.5 million for its latest reporting period.

Infrastrata PLC, which bought the company out of administration in late 2019, officially began trading under the Harland and Wolff name last September.

The group, which is also seeking to develop gas storage caverns under Larne Lough at Islandmagee, said it is in year three of a five-year plan to make the shipyard profitable again.

But it said the war in Ukraine and the ongoing energy crisis have hit those plans.

Publishing its accounts for the 17 months ending December 31 2021, Harland and Wolff Group Holdings PLC said revenues grew to £18.5m during the period, up from £1.5m for the year to July 31 2020.

The company has now absorbed pre-tax losses of around £36m in the last two reporting periods, with losses reaching £25.5m in the latest 17 months.

It put the losses down to “significant investment to support future growth of the business”, including the acquisition of three shipyards.

Appledore in Devon was acquired in August 2020, followed by Scottish yards Methil and Arnish in February 2021. All three now bear the Harland and Wolff branding.

While it has downgraded its revenue outlook for the current year due to rising energy prices and the crisis in the Ukraine, the London-listed group expects 2022 revenues to be in the range of £65m to £75m.

Acknowledging that the last two years had been “very challenging”, chief executive John Wood said: “I have always maintained that reactivating all the assets and moving along the growth to profit curve is effectively a five-year journey and we are now in year three.

“Whilst we appear to be battling the next global crisis as soon as the previous one has ended, I am certain that our strategic presence and work in the sunrise sectors of defence and renewables will be increasingly valuable.”

Just two-and-a-half years on from being saved from closure, Harland and Wolff’s new owner said the Belfast yard’s repair dock has been full for the last six months.

It said more than 22 vessels have docked for repairs since January 2022 as the cruise industry recovered from the pandemic.

The work included repairs on the Eduard Toll, the largest Liquified Natural Gas (LNG) carrier to have dry docked in the UK.

While owned by a US investment firm, the ship was chartered by the Yamal LNG project in Russia. Despite the UK transport secretary announcing a ban "on all ships with any Russian connection whatsoever" from entering UK ports in February, Harland and Wolff said it had been redelivered to the client on time and on budget.

It said talks are now ongoing on a potential fleet-wide multi-year deal.

“Given the sanctions placed by the UK Government on Russia and Russian related assets as part of the ongoing crisis in Ukraine, management is particularly sensitive to compliance with these sanctions,” said the company.

“Accordingly, management has put in place procedures and protocols to ensure that any vessel/asset coming into any of the facilities is in compliance with UK Government requirements relating to Russian ownership or any ongoing Russian connections that would breach these sanctions.”

The group also said its ship contracts have been getting increasingly larger as confidence grows in the Harland and Wolff brand.

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