Norwegian shipbuilder Havyard Group has identified more losses on vessel projects, which have caused covenant breaches at its subsidiary Havyard Ship Technology (HST).

It said last month that it had noted losses on two newbuildings, Hull No 131 and 135, which are fishing vessel prototypes.

But on Monday, it said it had also identified losses related to Hull No 141 to 145. The yard is known to be building ferries and accommodation units.

As a result, HST's equity is lost and there are now also breach of covenants, the company added.

Meetings have been held with banks and guarantors to ensure completion of ongoing projects at HST.

It added: "Furthermore, a dialogue will immediately be initiated with customers and suppliers where the aim is to ensure outfitting of projects under completion at HST, and to find satisfactory solutions for other projects."

Work on continued operations will be "maintained on a secured basis" through cash settlement or bank guarantees, so that creditors' current positions will not deteriorate, it said.

However, payments for new debts will be suspended.

"An analysis will also be made of the consequences that the loss of equity in HST will have for the consolidated group," it said.

Fearnley Securities, which is advising Havyard, said the announcement suggests that Fjord1's ferries — set for the first quarter of 2020 — will likely be delayed.

"However, we believe the company will be able to deploy backup ferries until the vessels are delivered. That said, Fjord1 is potentially facing higher cost in order to finalise the construction," it added.