Triyards sinks into US$162.5m full-year loss with two shipbuilding contracts cancelled

TRIYARDS Holdings, the yard-operating unit of offshore marine firm Ezra Holdings, has swung deep into the red following the termination of two shipbuilding contracts worth some US$51 million.

In a Singapore Exchange (SGX) filing on Friday, the company said that its Vietnam facility, Saigon Offshore Fabrication and Engineering Ltd, has received termination notices from the customer which is claiming reimbursements of all sums paid in advance amounting to about US$10.2 million. Triyards said that termination of the two contracts was because it was unable to deliver the projects by the contractual delivery dates as it lacked funding to complete the vessels.

The company also said it is facing loan-repayment issues that could pose a possible threat to its going-concern status.

The contract cancellations helped send Triyards into a net loss of US$162.5 million for the 12 months ended Aug 31, 2017, against a net profit of US$17.8 million a year ago. Loss per share stands at 50.06 US cents, from an earnings per share of 5.48 US cents a year ago. No dividend has been declared for the period.

As at Aug 31, the group has net current liabilities of US$60.8 million. The group has defaulted certain bank facilities, and is currently in discussion with respective lenders for a mutually acceptable settlement, it said.

Revenue for the group fell by US$208.7 million, or 64 per cent, to US$116.2 million for FY17 from the year-ago period.

This decrease was mainly attributed to: lower contributions from its units, cost overruns of certain projects, provisions for liquidated damages due to contract cancellations and the reversal of US$51 million in revenue from the two shipbuilding contracts, Triyards said.

Last week, the company also announced that it has applied to the SGX for a waiver of the listing requirements to hold its FY17 annual general meeting (AGM), and announce its Q1 earnings, citing on-going restructuring plans. It has sought an extension to hold its AGM by March 31, and announce its Q1 results by Feb 28.

Triyards provides engineering, fabrication and ship construction solutions for the global offshore and marine industry. Its parent Ezra filed for bankruptcy protection in March, and trading of its shares has been suspended since September.