Austal (ASX:ASB) has been awarded a $1.03 billion design and build contract for landing craft medium vessels under the strategic shipbuilding agreement with the Commonwealth of Australia.
The contract appoints Austal subsidiary, Austal Defence Shipbuilding Australia, to design and construct 18 steel LCMs at the company’s Henderson, Western Australia shipyard.
Construction of the first vessel is scheduled to begin in 2026, with the final LCM expected for delivery in 2032.
The LCMs, built for the Australian Army, will be capable of carrying loads of up to 80 tonnes.
Austal CEO Paddy Gregg described the award as a "significant milestone" for Austal Defence Australia, marking the first vessel program under the SSA and signaling a long-term commitment to continuous naval shipbuilding in Henderson.
"This contract opens decades of opportunity for collaboration and investment in Australia’s defence programs," Gregg said.
Gavin Stewart, Executive General Manager – Strategic Shipbuilding at Austal Defence Australia, highlighted the readiness of local industry and supply chains to deliver the new amphibious capability.
"Our team, along with partners across Western Australia and nationwide, is ready to deliver this important capability for the Australian Army," he said.
At the time of reporting, Austal's share price was $5.89.