Vessel builder VARD's financial statements. (Image: Stockfile/FIS)

Vard deepens losses in second quarter

NORWAY
Wednesday, July 26, 2017, 23:50 (GMT + 9)

Norwegian specialist shipbuilder and designer Vard Holdings reported a loss of NOK 69 million (USD  8.6 million) for the second quarter, which it attributed to restructuring and other costs as well as a foreign exchange hit.

This result was 30 per cent worse than the loss of NOK 53 million (USD 6.6 million) recorded in the same period a year ago.

Revenue for the three months to June 30 dipped 4 per cent to NOK 2.13 billion (USD 2.6 million) but it was 20 per cent higher compared with the first quarter of this year.

The group recognised a restructuring cost of NOK 4 million (USD 500,000) during the quarter and NOK 10 million (USD 1.2 million) in the first six months.

"Vard's business transition continues to progress amidst challenging market conditions," pointed out Roy Reite, Chief Executive Officer and Executive Director of the company that is now 78.20 per cent owned by Fincantieri.

The firm’s executive also stressed that a two-pronged approach has been adopted in sustaining its efficiency by fostering and exploring new opportunities in diverse markets, whilst internally working towards stabilizing workloads across the different shipyards.

Depreciation, impairment and amortisation costs came in at NOK 60 million for the second quarter and NOK 113 million (USD 14.1 million) for the half year.

Vard's net loss for the half-year widened to NOK 94 million (USD 11.8 million) from NOK 16 million (USD 2 million) a year earlier.

Aggregate order value at the end of the quarter was NOK 22.75 billion (USD 2,848 million), comprising 44 vessels, of which 37 will be of Vard's own design.

Vard said it continues to focus on diversifying its product portfolio with a contract secured during the second quarter for a research expedition vessel. This marked the entry into another new market.

Despite a letter of intent for one exploration cruise vessel signed in January this year having expired without resulting in a firm contract, Vard said it still sees opportunities in this market. The fisheries and aquaculture sectors continue to see high activity, but competition is also strong, it added.

 
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