Princess Yachts reports “disappointing” results
Despite losses incurred due to supply chain issues, the British boatbuilder is optimistic for the 2023 financial year…
Princess Yachts has recorded millions in losses in its recently released results for the fiscal year ending on December 31st, 2022. Despite this, the British shipbuilder is optimistic about its business prospects in 2023, having navigated significant disruptions to its operations and securing investment.
Princess Yachts reported a slight increase in its annual turnover, climbing from £308m in 2021 to £315m in 2022. However, a surge in operating costs during this period led to Princess Yachts experiencing an EBITDA decline, moving from a loss of £200,000 in 2021 to a loss of £25.7m by the end of 2022.
This was mainly due to supply chain challenges, with some partially built boats having to be temporarily taken out of construction. This resulted in increased financial working capital requirements and delays in project completion, all while incurring substantial retrofitting costs.
The most affected components included large items such as engines, generators, electrical panels, and air conditioning equipment, which often arrived months behind schedule.
The financial impact of this has been somewhat mitigated as the company secured additional capital to enhance its production efficiency and expand its capacity. Following its acquisition by KPS Partners earlier this year, there has been a cash injection of £53.7m into the group to support working capital and future growth.
“Looking forward with the transfer of ownership to KPS Capital Partners in March 2023, the Board of Directors look to embrace their manufacturing and transformation expertise along with financial support, to evaluate short-term and strategic opportunities for the company within the marine sector,” says company CEO, Will Green.
Princess Yachts also announced plans to invest £35m in new product development and £5m in expanding its primary South Yard Facility in Plymouth.
In terms of the shipyard’s outlook for the future, Princess Yachts has invested £14.7m in product development and introduced three new models, including the Princess Y95 (pictured). The shipyard further unveiled plans to introduce three new models in 2023, with three more slated for 2024.
These new models have translated into prospective commercial success, resulting in an order book of over £750m as of July 2023, with deliveries scheduled up to 2025. Alongside its expanding capacity, Princess Yachts anticipates that these developments will be the driving factors behind to its long-term growth strategy.
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