The Austal Limited (ASX: ASB) share price certainly has been a very strong performer on Tuesday.
In afternoon trade the ship builder's shares are up a sizeable 11% to $2.57.
This makes Austal one of the best performing shares on the S&P/ASX 200 Index (ASX: XJO) this afternoon.
Why is the Austal share price zooming higher?
Investors have been buying Austal's shares on Tuesday after it revealed that the U.S. Navy and U.S. Department of Homeland Security have identified the Austal USA business and U.S. defence ship building activities as mission essential industries during the COVID-19 pandemic.
According to the release, the U.S. Government is working with Austal USA to ensure that all efforts are taken to protect the workforce and to continue the production and maintenance of its ships.
Austal USA currently has six ships under various phases of construction at its Mobile, Alabama shipyard. This includes the Independence class Littoral Combat Ship (LCS) and Spearhead class Expeditionary Fast Transport (EPF).
Austal's chief executive officer, David Singleton, said: "The USA shipyard is adhering to the strict safety guidelines issued by the United States Centers of Disease Control and Prevention and the World Health Organization and has taken a number of significant steps to ensure workforce safety at the shipyard."
He added that: "the company's precautions to date have included travel restrictions for non-essential employees, detailed reviews of recently travelled employees, comprehensive facility sanitisation, social-distancing, and moving to virtual meetings whenever and wherever practical."
Outside the United States, Austal's shipbuilding and sustainment operations throughout Australia, The Philippines, and Vietnam remain open and continue to operate. Management advised that these operations are all complying with the respective applicable COVID-19 response directives issued by the Governments and Health Authorities in each country.
