Company Snapshot: Harland and Wolff Group plc
Harland and Wolff Group operates as a diverse engineering group with a number of special capabilities related to marine engineering and design. The Group remains a wholly owned subsidiary of the Fred Olsen Energy Group based in Norway.
The Northern Ireland group has been trading successfully in recent years and although turnover has fluctuated the basic trading position has been profitable.
The operating loss in 2007 of nearly £0.8m was attributed to an exceptional charge of over £2m related to a challenge on a bridge contract completed some years earlier.
Operating profits have generally been a steady return when compared to the level of turnover.
In 2010 and 2011, the Group emphasises that its task is to secure sufficient levels of work in a market where some potential projects have been delayed and there are high levels of competition for each contract.
However, some contracts for the building dock have been taken and a contract for logistics and assembly for the Ormonde Offshore windfarm is expected from late 2010 until September 2011.
A particular feature of the Group accounts is the impact of the large defined benefit pension scheme, administered through the Group, which continues to have over 3,600 members (mainly ex-H&W employees).
The actuarial accounting for the pension scheme liabilities has had a significant impact on the balance sheet.
The net assets of the pension scheme were valued at over £2.2m at the end of 2007.
As a result of a decrease in the market value of the scheme assets, it swung into deficit in 2008 and further into deficit in 2009.
At the end of 2009, the deficit as reflected in FRS 17 was £12.7m in a scheme where the assets were estimated at £109m.
Fluctuations in the assessed net liability of the pension scheme are the main reason for the sharp reduction in the balance sheet value of shareholders funds. In 2009 these changes more than offset the positive impact of the retention of post-tax profits.
In 2009, the Group provided a range of services for 58 vessels ranging from short stay emergency repairs to normal maintenance repair dockings and including longer duration refits.
This included contracts for the ferries owned by Stena Line and P&O and three tankers for Northern Marine Management.
Offshore renewable energy assembly business attracted orders from E.ON and Vestas and work for the Robin Rigg Offshore Windfarm.
A contract for the assembly and float out of a large steel offshore substation for German customers was successfully completed.