The nationalised shipyard firm at the centre of Scotland's ferry fiasco admitted there is "significant doubt" over its ability to continue as a going concern due to doubts over future funding.

In its delayed financial statement of affairs just put before MSPs, directors said that ministers who are continuing due diligence over Ferguson Marine's budget for next year are expected to clarify any uncertainty in the first half of this year.

It states that the long-delayed delivery of two vital lifeline ferries continues to be reviewed alongside the timeline for delivery.

The annual accounts for 2021/22 which has just been laid before the Scottish Parliament stated that the current budget allocation for 2021/22 did not cover their full costs anticipated for January and say that the languishing ferries are subject to additional cost and overrun.

It came as net profits for the Scottish Government-owned firm slumped from £82.4m in 2020/21 to just £130,000 in 2021/22.

"The Scottish Government have commissioned due-diligence work on behalf of Scottish Ministers in considering revised budgets for [the ferries]. This, alongside wider due diligence, creates an uncertainty over Scottish ministers' future commitment to fully fund the two vessels through to completion," says chief executive David Tydeman in a commentary related to the delayed annual report sign off on February 22.

READ MORE: 'Beyond scandalous': Ferry fiasco firm costs taxpayer nearly £500m...so far

"An ongoing due diligence review, which is not yet concluded, into the future direction of Ferguson Marine creates a risk and uncertainty over future activity, and whether activity and contracted income will be in place to meet all liabilities as they fall due.

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"Therefore, the board of directors has identified a material uncertainty related to events or conditions that may cast significant doubt on the group’s ability to continue as a going concern and, therefore, that it may be unable to realise its assets and discharge its liabilities in the normal course of business."

The board of directors went on to say that they are working with the Scottish Government to "continue to develop our strategy and processes to deliver a sustainable business model which will secure the long-term position of the company as a strategic asset for the shareholder as a key piece of infrastructure to deliver benefit for the Inverclyde economy in both jobs and wealth creation".

The Herald previously revealed concerns for the future of the firm because ministers had continued to stall on signing off on the extra funding.

Public finance watchdogs Audit Scotland yesterday said that there are "risks and uncertainties" over the financial future of Ferguson Marine going forward while the costs of delivery of long-delayed ferries has soared.

Ferguson Marine responded to the Audit Scotland concerns saying they believed there was a  "strong future" for the business despite doubts expressed.

Mr Tydeman said:  “Looking ahead, post-delivery of the two LNG hulls, we believe there is a strong future for the yard based on two visible pipelines:  winning further shipbuilding contracts from Caledonian Maritime Assets Limited  [the Scottish Government-owned ferries  owner and procurer] as well as contracts for BAE to support its T26 frigate programme by building modules within the yard ready for assembly at its Govan shipyard.  We already have some staff seconded to Govan and the arrangement is working well.

“We intend to submit a strong bid for CMAL’s small vessel replacement programme (SVRP) and believe we are well placed to win this contract, given our experience of exactly this type of work in the past. Securing this business, alongside completion of the two dual fuel vessels, is now our primary focus and central to the future of the yard.

“The Small Vessel Replacement Programme (SVRP)  ferries will be an evolution of three electric hybrids - MV Lochinvar, MV Hallaig and MV Catriona - successfully built by the shipyard in 2012-2015.

"Drawing on this previous experience and capability means we avoid a steep ‘first-of-class’ learning.  Securing this programme of work would allow us to steadily increase efficiency, programme management, labour profiles and outputs, and place the yard in a competitive position for future larger and more complex ships, including those required by the offshore wind farm market over the next 15 years.”

The Herald revealed that the Scottish Government's public spending bill for nationalised Ferguson Marine which is delivering the ferries has soared to more than £450m.

READ MORE: Ferguson Marine: Ferry firm sanctioned twice over financial fails

The sum was more than £200m more than what public spending watchdogs were expecting would be spent to finally deliver the two ferries at the centre of the Ferguson Marine debacle last year during its inquiry into the rising costs.

The Herald: Ferguson Marine gateways.

The Herald revealed three weeks ago that the taxpayer-supported nationalised shipyard firm has been sanctioned twice over its financial dealings before facing moves by Companies House, the UK Government executive agency which oversees the incorporation of firms, to close it.

That was later aborted after Ferguson Marine assured the body that the accounts would be delivered by the end of this month.

The shipyard firm, which was taken over by the Scottish Government four years ago after its financial collapse under the control of tycoon businessman Jim McColl was due to deliver accounts on December 31 and have only just been delivered.

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The Auditor General has said that uncertainty remains over the final costs and completion dates of Glen Sannox and Hull 802. 

The vessels at the centre of the ferry fiasco were due online in the first half of 2018 when Ferguson Marine with one initially to serve Arran and the other to serve the Skye triangle routes to North Uist and Harris, but they are at least five years late. It is suggested the costs of delivery has quadrupled compared to the original £97m cost.

Directors stated in the latest financial analysis that the Scottish Government provide monthly funding in arrears to cover the costs of completing both ferries.

"There is not yet clarity over the future investment by Scottish Ministers, beyond [Glen Sannox] and 802, which would allow additional investment in the yard, enabling the yard to competitively compete for and win new work," directors stated.

"Beyond the delivery, at this point in time, the group have no further contracts to deliver. Without certainty over future funding, the ability for the group to be competitive in future contracts may be affected, including the small vessels replacement programme planned by CMAL on behalf of Transport Scotland."