Shipbuilder Harland & Wolff has suspended trading in its shares on the London Stock Exchange after the company failed to publish its annual results on time.
The Belfast-based company, which owns the historic shipyard where the Titanic was built, said the audited accounts had been delayed due to ongoing discussions with its accountants over how to account for income from some of its “multi-year and complex” contracts.
As a result, the company missed the deadline for publishing its results (June 30) and temporarily suspended trading of its shares on the Aim market.
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Harland & Wolff said: “Given the multi-year and complex nature of some of the contracts under which the company works, the company has engaged in extensive discussions with its accountants to agree on the methodology for recognizing revenue over the life of a construction program.”
According to the company, the group recently reached an agreement with auditors on the treatment of earnings and aims to publish results next week. At that time, the suspension of the shares is expected to be lifted.
In its unaudited 2023 financial results, released on Monday, the company posted a pre-tax loss of £43.1m, compared with a loss of £70.8m in 2022.
Revenues more than tripled from £27.8m the year before to £86.9m.
It comes amid uncertainty over a £200m government loan guarantee, which has cast doubt on Harland & Wolff’s future.
A report in The Times newspaper in May suggested Chancellor Jeremy Hunt was expected to block a major bid for a corporate bailout amid an “intense government row”.
Harland & Wolff Group CEO John Wood insisted at the time that the company’s application “has not been rejected” and is “still in development.”
The group has built up a large mountain of debt, for which it is faced with sky-high costs due to higher interest rates, and has been under financial pressure for years.
Five years ago, the company was saved from bankruptcy thanks to a deal with energy company Infrastrata.
Harland & Wolff received a boost when the Team Resolute Consortium to which it belongs won the bid to supply three fleet solid support ships (FSS) for the Royal Fleet Auxiliary.
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It has applied for support from the government’s Export Development Guarantee Scheme.
The scheme typically covers up to 80% of the risk for lenders on loans up to £500m, but Harland & Wolff asks for a 100% guarantee when applying.
In the unaudited results, Arun Raman, group finance director, said: “I am very encouraged by the revenue growth from 2022 to 2023 as we look to achieve the critical mass required to reach cash breakeven.”
“Our borrowing costs are high, exacerbated by the base rate increases in 2023, and it is crucial to close the UKEF (UK Export Finance) facility as quickly as possible to ensure the long-term stable working capital needed is for securing financing. large, multi-year contracts.
“Our work with the UK government continues to deliver this deal.”
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