Does Austal Limited continue to have efficient operating performance?

Team Veye | 09 Apr 2020 ASX - ASB
Does Austal Limited continue to have efficient operating performance?

Austal Limited (ASX: ASB)

Business Update and Response to Covid-19

Austal Limited (Austal) (ASX: ASB) on 7 April 2020 provided the following update on the Company’s operations and performance, as well as health and wellbeing measures being undertaken in response to the COVID-19 pandemic.

(Chart source: TradingView)


  • Operational and financial performance to date largely unaffected by COVID-19. 
  • FY2020 earnings guidance of no less than $110 million EBIT maintained.
  • Payment of unfranked 3 cps interim dividend (totalling $10.6 million) to proceed as planned. 
  • Austal working with defence customers to accelerate payment terms that will maintain predictable cashflow for Austal and its supplier base.


Austal Chief Executive Officer David Singleton said that Austal had continued to strive for the right balance between keeping its people healthy and keeping them employed. It has introduced a range of measures that enable the ongoing construction and maintenance of vessels, in a manner which limits health risks, to the greatest extent possible. (Data Source – Company Reports)


Veye’s Take

Austal’s has a robust balance sheet combined with a strong, coronavirus-resilient order book. Its continued efficient operating performance indicates that Austal has never been in a better position to weather these current challenges. The Company maintains its FY2020 guidance of Group EBIT of no less than $110 million. It is expecting Group revenue of no less than $1.9 billion with US shipbuilding EBIT margin of 7.5 – 8.5 percent. Austal has also reaffirmed the payment of the 3 cps interim dividend (totalling $10.6 million). Austal has a net cash position of $152.4 million as of 31 December 2019. The stock underwent some correction right up to its support level. It is now moving in an ascending triangle where it is likely to meet strong resistance at $3.60. Upon crossing this it can have the potential of touching previous highs again. Veye maintains a "Hold" on “Austal Limited” at the current price of $3.11


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