As a result of adjusted project forecasts and cost overruns, Bergen Group Shipbuilding is expecting an operating loss (EBITDA) of around NOK 200 million (approx $34.8 Mln) in the 3rd quarter of 2012. The main reason for this is related to the following projects at Bergen Group Fosen:
Bergen Group has recently made various operational and structural measures to regain control of the ongoing two projects at the Fosen yard.
“In August, we strengthened the management of the shipbuilding division, and in early September a new managing director was in place at Bergen Group Fosen. The new management team for the yard is now established, and a reorganization of senior management positions in both the project and production departments have been implemented. These actions, which have already generated positive operational results, have also disclosed a need for significantly increase in project cost forecasts. The increased use of resources in these projects will be accounted for in 3rd quarter” , says CEO Terje Arnesen.
Bergen Group will continue to have a strong focus on operational and structural measures necessary to ensure positive and improved financial operations at the yard, as well as reduced risk in future projects.
The Q3 results will most likely result in a breach of the covenants in existing loan to the Bergen Group ASA, and the group has therefore established dialogue with Norwegian Trustee who manages the bond loan.
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Press Release, October 30, 2012; Image: bergengroup