Troubled Harland & Wolff still cannot finalise its 2023 accounts and has suspended work on the books, meaning the current suspension of its shares will remain in place.
In a statement the company, which owns the Belfast shipyard, also confirmed that it has made two key changes to its board with immediate effect, with Russell Downs (56) joining as interim executive chairman and Alan Fort (68) coming on board as non-executive director.
In a detailed update to the stock market, Harland & Wolff Group Holdings also ratified its appointment of Rothschild & Co as its financial adviser to assess strategic options for the group and assist the board in deciding a route forward that will preserve the company’s core operations at its delivery centres including Belfast.
The shipyard owner’s woes began earlier this year when it failed to secure a UK Government guarantee on £200 million of new borrowing from commercial lenders.
It then sacked John Wood as group chief executive and announced it would wind down ‘non-core business lines’, starting with it axing a new fast ferry service planned between Penzance and the Isles of Scilly with immediate effect.
Just days ago H&W suffered another significant setback after a potential £120 million of work was pulled by the Falkland Islands Government.
On August 1 the company entered into arrangements with its existing lenders, Riverstone, to increase its facility by $25m to provide short term liquidity.
Harland & Wolff recorded £113m in losses across 2022 and 2023, with rising debt linked to a high interest $115m loan with New York-based Riverstone
The company says its priority remains to deliver its workload on the government on the government’s Fleet Solid Support (FSS), which will provide support ships designed to deliver crucial munitions, supplies and provisions to the Royal Navy.
“The company is in active discussions with this customer to agree the optimum route and continues to work on its existing order book to the fullest extent possible, whilst at the same time working with interested parties to find a solution that supports the long-term ambitions and prospects of the business,” H&W said in a statement to the stock market.
It added: “We remain reliant on the support of existing lender Riverstone, who continue to support the group through the provision of short-term liquidity and under its existing structure of guarantees, share pledges and secured debentures.
“Currently, the company and its board do not believe it can finalise its 2023 accounts on a going concern basis and, therefore, work to complete its unpublished accounts has also been suspended, with resources being focussed on the Rothschild process.
“Accordingly, the present suspension of the company’s shares will remain in place and we will will update the market in accordance with regulatory obligations as matters develop.”
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- Crisis at Harland & Wolff as UK government rejects £200m loan guarantee and CEO steps asideOpens in new window
Harland & Wolff’s new interim chair Russell Downs is a highly experienced finance professional after a 30-year career at PwC, most recently as partner. He is founder of Armada Advisers, a boutique advisory firm supporting stakeholders and advising on restructurings, and is currently also an executive director of Merry Hill shopping centre in Dudley.
He said:”We remain focussed on working with interested parties and key stakeholders to ensure that we can navigate through this uncertainty preserving the underlying value in the yards and the FSS contract for its employees and other stakeholders.”
Alan Fort has a long track record in performance improvement, with many years of board level experience providing support and challenge to management teams to ensure that goals are clearly defined and performance is transparently monitored. He is currently a non-executive director at steelmaker Celsa UK Group, where he previously held the role of chief restructuring officer.
