The following is the text of a news release from Austal USA:
(WASHINGTON) — Austal Limited (Austal) (ASX:ASB) is pleased to announce that the construction of two additional Littoral Combat Ships has been funded by the U.S. Navy.
The vessels, LCS 18 and LCS 20, will be the seventh and eighth vessels to be built by Austal as prime contractor under a 10-vessel, US $3.5 billion contract with the U.S. Navy.
The funding of LCS 18 and LCS 20 adds approximately US $684 million to Austal’s order book, raising it to a record total of $3.3 billion.
Austal Chief Executive Officer Andrew Bellamy said funding for the additional ships secured construction work at Austal’s US shipyard through to FY2019.
“Our knowledge base in designing and constructing these revolutionary ships continues to grow as the LCS program matures, enabling better program outcomes for the U.S. Navy, and improved margins and returns for shareholders,” Mr Bellamy said.
Austal has five Littoral Combat Ships under various stages of construction at its shipyard in Mobile, Alabama. This includes USS Jackson (LCS 6) – Austal’s first as prime contractor, following delivery of two prior LCSs via a subcontract with General Dynamics. LCS 6 was launched in December 2013 and is preparing for sea trials before delivery by the end of CY2014. USS Montgomery (LCS 8) is scheduled to be launched in Q4 FY2014.
Apart from the LCS contract, Austal also has a US$1.6 billion contract from the U.S. Navy to build ten 103-metre Joint High Speed Vessels (JHSVs), all of which are fully funded. Two of these vessels have been delivered, with JHSV 3 scheduled to be delivered by the end of March. An additional three JHSVs are under construction.
