(Alliance News) - Shares in Harland & Wolff Group Holdings PLC on Thursday fell after it warned a different approach to revenue recognition could see some revenue being deferred to a later financial period.
The London-based fabrication company, which serves the maritime and offshore industries from yards in England, Northern Ireland and Scotland said it had commenced discussions with its auditors to ensure all parties are in agreement with the method of accounting for revenues throughout the duration of a build programme.
This was due to the multi-year and complex nature of some of the contracts under which the company is working, it said.
Harland & Wolff said it believes that it is taking a prudent approach to revenue recognition and remains comfortable with the market's expectation of GBP100 million revenue for this financial year.
However, it noted that a different approach to revenue recognition, whilst not changing the overall value of the contract, could lead to a range of GBP80 million to GBP100 million of revenue for this financial year, with any balance deferred until 2024.
The company said it would make a further statement when the audited position for revenue recognition has been settled.
It reiterated its estimate of revenues for financial 2024 at GBP200 million with a high degree of visibility over GBP145 million of these revenues at this stage, underpinned by the FSS and SeaRose contracts.
Contract negotiations continue with clients in all five of the company's target markets and the company continues to see a high level of activity in the energy, defence and commercial markets with bids being submitted and contracts being negotiated for large contracts, it said.
Shares in Harland & Wolff were down 5.0% at 12.35 pence in London on Thursday afternoon.
By Jeremy Cutler, Alliance News reporter
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Harland & Wolff (HARL)