Harland & Wolff upbeat on growing revenue backlog
By Josh White
Date: Wednesday 01 Mar 2023
(Sharecast News) - Harland & Wolff Group said in a trading update on Wednesday that it has a backlog of confirmed contracted revenues totaling around £900m.
The AIM-traded firm said the backlog was expected to extend over a seven-year period, with around £750m represented by the previously-announced FSS contract.
In addition, the company said it had a weighted pipeline of new business of more than £3.6bn of revenues over the next five years.
At the current win ratio of 34%, that equated to a projected backlog of about £1.24bn.
The firm updated its management outlook for the 2023 and 2024 financial year, with a target revenue of £100m to £115m for 2023, and £200m to £230m for 2024.
It said it expected to reach cash flow breakeven in 2024, adding that its target group blended gross margin was expected to be between 24% and 27% over the medium term.
Harland & Wolff also upsized its debt facility with Riverstone Credit Partners to a committed $100m, from a previous $75m.
The company said it was currently closing its proposed £200m refinancing early in the second quarter.
"It is gratifying to see the levels of activity that are already present in all of our yards, with the knowledge that this is only going to increase steadily - and materially - from this point," said chief executive officer John Wood.
"The Harland and Wolff machine is really starting to hum and our ability to operate flexibly across multiple facilities will become increasingly important as an industry differentiator as our workload expands.
"We look forward to the future with increasing confidence."
At 1407 GMT, shares in Harland & Wolff Group Holdings were down 0.3% at 16.7p.
Reporting by Josh White for Sharecast.com.
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