Harland & Wolff stock fights back after report says Govt contract at risk

Harland & Wolff’s (LSE:HARL) is reportedly at risk of losing a £1.6 billion contract from the UK Ministry of Defence contract.

The Belfast-based shipbuilder, which was previously placed into administration in 2019, had seen a turnaround in its fortunes by late 2022 when it emerged as a preferred bidder for the substantial defence contract.

The contract will see it build three vessels to provide munitions, stores, and provisions to the Royal Navy’s aircraft carriers, destroyers, and frigates. But, recent media reports suggest that the government is reconsidering the contract, with BAE Systems, Babcock, and A&P Group possibly stepping in to take over the project.

It comes after a report from The Times indicating that Harland & Wolff’s £200 million government funding round was rejected.

In response, chief executive John Wood denied the rejection claim, stating, "Our application has not been rejected and continues to be a work in progress.

“I expect to be providing a fuller update on our refinancing plans in the next few weeks."

In London, H&F stock fell 10% at one point, before recovering much of the early losses. By the close, the price was down 1% for the day at 9.65p.