May 16, 2008
Davie Yards records Q1 loss
Lèvis, Quebec, based Davie Yards Inc. (TSX: DAV) yesterday released its financial and operating results for the three month period ended March 31, 2008.
Revenue for the three months ended March 31, 2008 was US$10.15 million. EBITDA for the first quarter was negative US$8.7 million, and the company recorded a net loss of US$8.7 million. Due to the loss provision taken by the company in Q4 2007, Davie did not record a gross profit during Q1 2008. The loss of US$8.7 million in Q1 consisted of general overhead expenses and value adjustments in relation to currency options.
Davie has an order backlog of US$581 million as of end of March 2008, consisting of three Offshore Construction Vessels and two Multipurpose Accommodation Vessels.
The Company continued the ramp-up of the yard during the first quarter of 2008. As of May 12, Davie had 895 employees at the yard, up from 503 employees at year end 2007.
The number of employees is expected to increase further during the coming months as work continues on the completion of vessels already under construction and construction begins on other vessels in the order book.
In February, Davie completed an initial public offering of CDN$47.3 million, strengthening the Company's financial position.
Davie has appointed Mr. Steinar Kulen as the new CEO, he joined the company March 1st 2008, bringing significant shipbuilding/maritime experience to the company.
"Since I joined the Company, I have undertaken a thorough analysis of the processes and the projects at Davie. These efforts, coupled with a strategic business analysis, will enable us to finalize an updated version of the company's business plan this summer. I am pleased with what I have learned so far," Mr. Kulen said.
Despite reports that current challenging conditions in the credit markets are having an effect on the order book of shipyards, the market for large complex offshore vessels is strong, and Davie anticipates additional construction contracts in fiscal 2008.