Austal Limited (ASX:ASB) says it has reviewed its internal forecast for the full year ended June 30, 2011. It now expects net profits after tax to be in the range of A$20 million to A$23 million, which is below market expectations.

The shipbuilder says this is a direct consequence of the unprecedented strength of the Australian dollar and its impact on Austal's Henderson, Western Australia operation. This, along with continued softness in the European commercial ferry market, has spurred Austal to start a comprehensive review of the Henderson operation with the object of refocusing the shipyard's capabilities towards the defense sector.

Chief Executive Andrew Bellamy said Austal will continue to seek commercial vessel opportunities for the yard, "but with our internationally recognized defense capabilities, particularly in the U.S. as the prime contractor on two large multilevel programs, it is logical to leverage off those credential, and refocus Henderson toward, defense."

May 25, 2011