Harland & Wolff Group Holdings PLC Management Response to Financial Times Article

RNS Number : 7712W

Harland & Wolff Group Holdings PLC

17 July 2024

 

17 July 2024

 

Harland & Wolff Group Holdings plc

("Harland & Wolff" or the "Company")

Management Response to Financial Times ("FT") Article

Harland & Wolff Group Holdings plc (AIM: HARL), the UK quoted company focused on strategic infrastructure projects and physical asset lifecycle management, provides the following statement in relation to an article published on 16 July 2024 in the Financial Times and certain other media outlets about the Company's £200 million Export Development Guarantee ("EDG") application.

The Company considers these articles to be speculative and misleading. The Company has not received any  decision from Government in relation to its application and the Company continues to provide information and updates on a regular basis to facilitate Government in its decision-making process.

The Company makes the following comments to address points made in these articles and to provide clarification:

·      The EDG application made by the Company has been for the standard 80/20 EDG product; 20% of the loan is an unguaranteed and commercial tranche and 80% of the loan is the guaranteed tranche that is funded by banks and guaranteed by UK Export Finance ("UKEF").

·      This is a standard UKEF product and the structure and terms are consistent with other similar transactions in the market.

·      The Company has not asked for a 100% guaranteed product on any occasion.

·      There are no taxpayer monies provided to the Company. The funds received by the Company will be from the commercial lender and the banks with which the Company has agreed terms.

·      The Company continues engagement with Government on a standard EDG product that has been offered to hundreds of other entities, both in the UK and globally. There is no deviation or departure from what is a standard product that has been used for several years.

·      The Company has consistently maintained that it remains prepared to execute the transaction on a standard 80/20 EDG product basis.

·      The Company was informed in December 2023 that the EDG facility had been approved and was subject to a commercial rate review and final ministerial consent. An announcement was made on that basis with the consent of Government. The Company has not been informed by Government that it has withdrawn its approval for the EDG facility.

·      The legal advice that the Company has received confirms that a commercially negotiated and priced EDG loan (for which the Company has applied) does not breach state aid rules. Further discussions are ongoing with the Department of Business and Trade ("DBT") to understand any differences between the advice received by DBT and that received by the Company.

·      The Company's lender, Riverstone Credit Partners, have been fully supportive of the Company and have enabled the Company to win crucial contracts such as the M55 Regeneration Programme, Cory barges, FSS Programme and, most recently, the Searose project.

·      The Company further provides some key highlights to demonstrate the growth and future prospects of the Company:

o  All four yards are now fully operational;

o  Over 1,500 high quality manufacturing-related jobs have been created;

o  over 140 apprentices being trained on an annual basis;

o  Revenue projections of £200 million for FY24 continue to be expected to be achieved;

o  Scottish yards fully geared up for the renewables fabrication with circa £1 billion of work tendered; Methil and Arnish part of the Scottish Offshore Wind Energy Council ("SOWEC") to attract significant capital investment in both yards; and

o  Management remains confident in its plans to realise its aspiration of c£500 million per annum revenues.

The Company continues to maintain its discussions with Government and will make further announcements on the outcome of its EDG application in due course.

 

For further information, please visit  www.harland-wolff.com  or contact:

 

Harland & Wolff Group Holdings plc John Wood, Chief Executive Officer Arun Raman, Chief Finance Officer	[phone] [e-mail]   [e-mail]
h2Radnor (Investor Relations) Neville Harris / Josh Cryer	[phone]
Cavendish Capital Markets Limited (Nominated Adviser & Broker) Stephen Keys / Callum Davidson / Dan Hodkinson (Corporate Finance) Michael Johnson (Sales)	[phone]
Liberum Capital Limited (Joint Broker) Nicholas How / Edward Mansfield	[phone]

About Harland & Wolff

 

Harland & Wolff is a multisite fabrication company, operating in the maritime and offshore industry through five markets: commercial, cruise and ferry, defence, energy and renewables and six services: technical services, fabrication and construction, decommissioning, repair and maintenance, in-service support and conversion.

 

Its Belfast yard is one of Europe's largest heavy engineering facilities, with deep water access, two of Europe's largest drydocks, ample quayside and vast fabrication halls. As a result of the acquisition of Harland & Wolff (Appledore) in August 2020, the company has been able to capitalise on opportunities at both ends of the ship-repair and shipbuilding markets where there will be significant demand.

 

In February 2021, the company acquired the assets of two Scottish-based yards along the east and west coasts. Now known as Harland & Wolff (Methil) and Harland & Wolff (Arnish), these facilities will focus on fabrication work within the renewables, energy and defence sectors.

 

In addition to Harland & Wolff, it owns the Islandmagee gas storage project, which is expected to provide 25% of the UK's natural gas storage capacity and to benefit the Northern Irish economy as a whole when completed.

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