Harland and Wolff, the iconic Belfast-based shipbuilder best known for constructing the RMS Titanic, has formally entered administration for the second time in five years.
This comes after the company’s board warned last week that such a move was inevitable, citing mounting financial losses and the government’s refusal to provide support.
The administration process is confined to the holding company, Harland & Wolff Group Holdings plc, while the operational subsidiaries running the shipyards will continue trading. The company’s main shipyard is in Belfast, but it also operates sites in Appledore, England, and Methil and Arnish, Scotland.
“Reduce the Headcount”
Harland and Wolff’s executive chairman, Russell Downs, who was brought in as a restructuring expert, remains hopeful that the shipyards will find new ownership. Gavin Park and Matt Cowlishaw of Teneo Financial Advisory have been appointed as joint administrators to oversee the process.
However, the 59 employees of Harland & Wolff Group Holdings plc face an uncertain future. Downs acknowledged that layoffs would be necessary, stating that some staff will be retained under a transitional services agreement, but the headcount will be reduced.
In a statement, Harland and Wolff said: “The Administrators will unfortunately be required to reduce the headcount upon appointment.”
Shareholders Wiped Out
Harland and Wolff also confirmed that shareholders in the holding company will see their investments wiped out as a result of the administration. The company, once a giant in the global shipbuilding industry, has faced persistent financial struggles in recent years despite securing contracts, including a notable Royal Navy deal in 2022.
A Storied History
Harland and Wolff was founded in 1861 by Edward Harland and Gustav Wolff and became a dominant force in global shipbuilding in the early 20th century. The Belfast shipyard rose to international prominence for its construction of the Titanic, which tragically sank on its maiden voyage in 1912.
After decades of declining demand, Harland and Wolff found itself on the brink of collapse in 2019 when its Norwegian owners withdrew financial support. The company was rescued from insolvency by Infrastrata, a small London-based energy firm with minimal experience in marine engineering, which subsequently rebranded itself under the Harland and Wolff name.
Mounting Losses
Despite hopes for a revival under new ownership, financial woes continued to plague the shipbuilder. Accounts from 2021, covering a 17-month period, revealed losses exceeding £25 million. In 2022, audited financials showed a turnover of £28 million, but losses had ballooned to approximately £70 million.
Unaudited figures from 2023 pointed to further losses of £43 million. The company’s financial difficulties were compounded by reliance on high-interest borrowings from US lender Riverstone, as well as hopes for a government loan guarantee, which was ultimately denied.
In July 2024, the government stated that there was “a very substantial risk that taxpayer money would be lost” and refused to offer support.
Future Uncertain
With Russell Downs at the helm, Harland and Wolff will now undergo a strategic review to determine the best course of action.
Downs remains optimistic that the shipyards will continue operating and hopes to secure a new owner. However, the company’s future remains uncertain as it faces yet another financial reckoning in its storied history.
