Navy awards Austal LCS 36 and 38

DECEMBER 16, 2018 — Austal (ASX: ASB) reports that the United States Department of Defense has awarded Austal USA a contract to build two additional Littoral Combat Ships: LCS 36 and LCS 38.

The Navy says that it has not completed the competition for fiscal 2019 LCS class ships and that “therefore, the specific contract award amount for these ships is considered source selection sensitive information” and will not be made public at this time. However, the award is under the congressional cost cap of $584 million per ship.

“This latest order from the U.S. Navy is a tremendous endorsement of Austal’s unique aluminium trimaran and further evidence of the important role Austal plays in building the United States Navy” Austal CEO, David Singleton said. “We have been very successful, winning two Littoral Combat Ships per annum in competitions in each of the last three U.S. Government financial years. This has been achieved as a result of a highly focused and successful program of production efficiency at our shipyard in Alabama and is a credit to that team”

“The award of LCS 36 and 38 will mean that Austal has a forward order book of a further ten ships to deliver in a continuous production program that now extends out to 2025,” he added. “This strong order book creates continuity and certainty of workload for the Austal workforce in Alabama who have achieved so much. For our shareholders, the order book will drive continued growth in earnings over the next few years.”