US shipbuilder Philly Shipyard expects losses to continue into next year as it ramps up production of new training ships for the US government.
The Aker Capital-controlled company said it is operating at less than full capacity.
The Oslo-listed shipbuilder's net loss in the third quarter was $6m, down from $9m a year ago. Revenue grew to $13.9m, up from $3.7m in the same period of 2019.
Philly expects to start work in the first and second quarters of 2021 on the first two of five merchant marine academy training ships ordered by Florida-based TOTE Services under a US Maritime Administration (MarAd) scheme.
The first two of these national security multi-mission vessels (NSMVs) are worth $630m and are due to be completed by 2023.
"Philly Shipyard’s main focus is securing awards for the three option vessels," the yard said.
On hold
The US House of Representatives’ appropriations bill for fiscal year 2021 includes sufficient funding for NSMVs three and four, the company added.
But the budget process is on hold with a continuing resolution to temporarily fund the federal government lasting into mid-December 2020.
If all five ships are ordered and built in series, then the total contract value would be worth about $1.5bn over the next five years.
Full yard capacity is not expected to be reached until the second half of next year.
Total cash and cash equivalents stood at $87.3m on 30 September.
Philly Shipyard has also begun work on a new industry study in the period for the US Navy’s Auxiliary General Ocean Surveillance (T-AGOS) programme, under a subcontract from its partner, ship designer BMT.
