Havyard closes yard amid COVID-19 outbreak

At least 17 people linked to Norway’s shipbuilder New Havyard Ship Technology AS, part of Havyard Group, have tested positive for COVID-19, resulting in work suspension at the yard.

The Leirvik-based shipyard temporarily halted activities on September 30, after four infection cases were confirmed.

“After the closure, the yard has worked closely with local health authorities to clarify the extent of the spreading of the virus, where approx. 200 people have been tested so far. As of today, approx. 17 people associated with the yard have been diagnosed with the infection,” Gunnar Larsen, Havyard CEO said in a filing to Oslo Stock Exchange on Friday.

In order to prevent the further spreading of the infections and carry out the necessary contact tracing, the Hyllestad municipality decided to keep the yard business closed until October 10, 2020.

The decision may be extended, according to Larsen.

The closure is likely to impact the delivery schedule of the vessels being outfitted at the yard.

“Any delay will depend on the extent of the shutdown and what measures that can be implemented to make up for the lost production time,” Larsen said.

During winter/spring 2020, Havyard’s operations started to be impacted by the spread of the virus and activities related to infection control. The activity at the yard almost stopped for a while but in August the operations were back to normal.

In general, all ongoing sales projects have been postponed and travel activity reduced, the company revealed in a business report for the first six months of 2020.

The group reported a loss before tax of Nkr 32 million ($3.4 million), in the first 6 months of 2020, down by 2.5% year-on-year, with a major portion of the loss being assigned to large restructuring costs.

The company was in breach of its covenants as of Q2 2020, with all long-term loans reclassified to short-term loans.

Like many of its counterparts, Havyard has been in talks with lenders to postpone the repayment of loans and secure new facilities so as to firm up the group’s financial position.

The order book for 2020 saw a fall in all segments, reaching Nkr 2,314 million at the end of the second quarter of 2020 compared to Nkr 3,205 million in the year-end 2019.

Havyard group specializes in shipbuilding technology, ship design as well as engineering and installation of electric and ballast water treatment systems.