Austal's (ASX:ASB) fiscal 2026 loss before interest and taxes of AU$125.2 million was driven by an onerous US shipbuilding contract, while its revenue of roughly AU$2 billion fell short of Euroz Hartleys' AU$2.2 billion estimate, the equity research firm said in a Monday note.

The company's Australasian revenue increased 49% to AU$650.7 million, driven by the start of strategic shipbuilding agreement programs, including landing craft medium and landing craft heavy, Euroz Hartleys said.

Meanwhile, US revenue fell marginally as growth in shipbuilding and submarine module production was offset by lower support activity.

The results are broadly in line with expectations given Austal's trading update earlier in August, Euroz Hartleys said.

The company has also granted Hanwha Defence USA access to due diligence following its indicative and conditional offer to acquire Austal USA for an enterprise value of between $1.05 billion and $1.20 billion on a cash- and debt-free basis.

Euroz Hartleys maintained a buy recommendation on Austal with an under-review target price of AU$6.

The shipbuilder's shares gained over 2% in recent Monday trade.