THE transformation of Australian shipbuilder Austal in the past few years is nothing short of amazing.
In the last three years its workforce has grown from 1000 to 5000, while its revenue has increased from about $400 million to $1.5 billion. 
Last year it achieved a record profit of $52.2 million and a record order book at $3 billion. In 2012 its net profit after tax was $11 million and its order book was $800 million.
The group now has three shipyards. Its biggest is in Alabama, US, while its oldest is in Henderson, WA, and its newest is in Cebu, the Philippines.
Its main production for the US government is of the Littoral Combat Ship, which sell for about $560 million and are used for fighting close to shore; and of the high-speed troop carrier, which was called the Joint High-Speed Vessel and has been renamed Expeditionary Fast Transport. You can buy one for $US160 million.
"These days we've got a lot more visibility about our pipeline than when we started. We know now what we're building," managing director Andrew Bellamy said.
This is the big risk in custom shipbuilding, because when a new contract is awarded, the boat is designed from scratch. Consequently, economies of scale only come about after three or four are produced.
This was highlighted earlier in the year when it was announced the costs for building the Air Warfare Destroyer project had blown out by $1.2 billion to around $9 billion.
A Government report revealed each of the three new ships is expected to be finished more than 21/2 years behind schedule, but did not say why.
Austal has now delivered 250 ships around the world, on time and on budget. The big hope for investors is that it gets a large slice of the $79 billion that the Federal Government said it intends to tender on AWD over the next 20 years.
Some of the ships the government wants are known as offshore patrol vessels, which are similar in size and capability to the high-speed support vessels Austal is building out of its Henderson facility for the government of Oman. If Australia's Federal Government is looking for a national champion in the ship building arena, it need look no further than Austal.RICHARD HEMMING IS AN INDEPENDENT ANALYST WHO EDITS WWW.UNDERTHERADARREPORT.COM.AU, FOCUSING ON SMALL CAP COMPANIES