Recovery of its Cruise & Ferry business area may take longer than foreseen, warns STX Europe, the Oslo based unit of the South Korean STX Business Group.
The company builds cruise liners and ferries at two yards in Finland, which it owns in full plus at one in France, in which it has a 66% stake. The Cruise & Ferries business area of the group generated an EBITDA of NOK5 million in the first quarter, an improvement from a figure negative by NOK20 million in the same period last year.
“STX Europe still believes that the industry fundamentals are moving in the right direction, but that the improvements are slower than expected. The market is challenging as the general economic climate continues to influence customers’ decisions especially in relation to new building projects despite an increased interest within the market,” the company said in a statement
The operations of the Cruise & Ferries business area are not satisfactory on an overall basis for the quarter, and there are still challenges for the year ahead due to low order intake.
Accordingly, both STX Finland and STX France are strongly focusing on securing new orders and continuing the improvement programmes initiated in 2010 to improve competitiveness. This includes increased efforts within the other market segments such as vessels for naval operations, offshore related constructions and renewable energy/wind constructions.
The shipbuilding industry and current market situation is quite challenging, especially within the cruise and ferries segment. There are several potential new building projects, but the order activity is constrained by the limitations of funding and the overcapacity within the market, the company said.