West Australian ship builder Austal is shedding 300 jobs as it completes the building of Australian Customs and Border Protection boats and Navy vessels for Oman.
Austal confirmed it has made 40 non-permanent employees redundant and will cut another 260 staff at its Henderson ship yard south of Perth by early 2016.
The company is beginning to cut back positions as the federal government contract to build eight Cape Class Patrol Boats comes to an end, and it finishes building two High Speed Support Vessels for Oman later in 2015.
Austal Australia president Graham Backhouse said the cuts were necessary as the Cape Class contract entered its final phase.
"The contract required delivery of a large number of vessels in a short time frame and we needed to bulk up to meet that demand," Mr Backhouse said.
"Now that demand is close to finishing, we need to normalise our employee numbers."
He said the size of the Henderson workforce had doubled to around 600 in the past two years.
Austal said construction of the Cape Class customs vessels was now 80 per cent complete and due to be delivered in the third quarter of 2015.
The global defence contractor has a total of $2.6 billion in ship building orders, including 20 Littoral Combat Ships for the US Navy in Alabama, eight Australian Customs and Border Protection boats, two commercial vessels and two Navy vessels for Oman by 2018.
The company is targeting $1.2 billion in revenue for full year 2014/15.
It shares gained one cent to $1.77.
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