Business & Finance
Malta Shipyards loses Lm9.3 million in 2006
By MaltaMedia News
Jun 1, 2007 - 3:30:06 PM

The Malta Shipyard lost Lm 9.3 million in 2006 which is Lm3.3 million over the budgeted amount the company had set out to lose. In 2005, the company had lost Lm8.7million, after estimating that it would have lost Lm8.8million during the year.  

Despite the losses made in the recent years, the Malta Shipyards has come a long way since 2002, when it netted a loss totalling to Lm23 million, which was Lm4.9 million over the amount it had expected to lose.  

The Ministry for Investment, Industry and Information Technology (IT) said on Friday that the main reasons behind the company’s failure to curb losses  included low productivity which decreased rather than increased since 2004, poor time-keeping, ineffective supervision in the monitoring of daily performance,  the over allocation of employees and high ‘rework’ elements.  

The Ministry further said that subcontracting and the organisation were not part of the reasons why the Shipyards, restructured in 2003, failed to reach their targets.  

In a bid to remedy the situation at the Shipyards the Ministry believes that men allocation is to improve, while productions targets are to be given and checked, with the Management being held accountable. Reducing the consumption of consumable, improving the use of ‘indirect labour’ and maintaining control over subcontracted tasks will also help, according to the Ministry.  

It has been concluded that should there be no improvement at the shipyards; a profitability crisis will result along with a cash flow crisis that will lead to wages not being paid. Malta could also be investigated by the European Union (EU) for breach of commitments.