Ferguson stays afloat

Clyde shipbuilder Ferguson Marine, the last remaining independent commercial shipbuilder on the Clyde, slumped much deeper into the red in its latest financial period but the controlling Dunnet family, which accounts revealed yesterday had removed one burden by writing off a £4.425m loan, is predicting better times.

Ferguson’s directors, spearheaded by chief executive Alan Dunnet, see a brighter future where it will work on an increasing number of smaller contracts. The latest figures show the Port Glasgow yard had incurred losses of £3.34m in the extended accounting period from January 1, 2006, to May 31 last year.

Even taking into account this longer period, this represented a huge underlying jump in losses from the £1.22m recorded in what was a difficult calendar year 2005. Turnover, which had tumbled from £19.9m in 2004 to £12.2m in 2005, amounted to only £10.975m in the entire 17-month period to May 31 last year. But the Ferguson board hopes the loan write-off will assist ?recovery and diversification?.

Ferguson has been hit hard in recent years in its efforts to secure big shipbuilding contracts by the likes of cut-price competition from Poland, and the company now makes much of the diversity of its engineering experience as it adapts to changing times. Back in 2005, a political row had erupted over Ferguson’s defeat by Remontowa, a Polish rival shipbuilder in Gdansk, in the contests to build a Jura-class fisheries protection vessel and a Caledonian MacBrayne ferry. At the time, Dunnet accused the then Scottish Executive of driving another nail into the yard’s coffin by forcing it to compete without favour against new, subsidised members of the European Union and against firms in Asia.

Ferguson’s website now states: “Ferguson delivers engineering services across a range of industry sectors. Whilst best known for our shipbuilding capability, the company has delivered tailored solutions to support applications in materials-handling, fluids-distribution, system hydraulics, power-distribution and management, and civil engineering. Outputs range from large-scale mechanical structures such as bridges and piles to very specialist mechanical engineering devices.” The website highlights shipbuilding, in terms of being a “specialist provider of small commercial ships”, in a list of seven core competencies. The others are “hydraulics, pipework, electrical, fabrication, design, and joinery”.

The company, however, still maintains that the “principal activity of the group is shipbuilding” and that “opportunities exist to grow the business in the next few years and, with there being a shortage of capacity, this should ensure regular orders with improved margins.”