Philly Shipyard has received an extension on a series of loss-making mariner training vessels as it continues to wrestle with the aftermath of Covid-19.
The Oslo-listed, Aker Capital-backed shipbuilder said pandemic-related supply chain problems and recruitment issues pushed it to request — and receive — an extra four months to finish four national security multi-mission vessels (NSMVs) for US state-run merchant marine academies.
“Notwithstanding ongoing mitigation efforts, these factors are still contributing to schedule impacts, productivity loss and increased costs,” the company said in its fourth-quarter earnings statement.
“Philly Shipyard is also seeing a schedule extension for [a subsea rock installation vessel] on account of various delays.”
Now considered a drag on the bottom line, the NSMV project was a massive boost to the south Philadelphia yard, providing $1.5bn in contracts at a time when it was largely idle and expanding into government work to stay afloat.
It completed the first of the five vessels last year but took a $17.2m loss in the third quarter despite its delivery to the State University of New York Maritime College.
It has four vessels remaining on the contract.
The subsea rock installation vessel contract with Great Lakes Dredge & Dock Co was announced in November 2021.
The contract is worth $197m but rises to $382m if an option for a second vessel is exercised.
Philly Shipyard has a third contract, worth $1bn, with Matson to build three 3,600-teu dual-fuel container ships.
For the last three months of 2023, the company reported an $18.8m loss, deeper than the $8.3m loss a year earlier.
It brought in $86.5m in revenue, down from $110m over the same period of 2022.
For the full year 2023, Philly Shipyard recorded a $67.9m loss versus an $11.7m loss the previous year.
Revenue rose from $394m to $442m.
