BELFAST'S Harland & Wolff shipyard yesterday reported pre tax consolidated losses of £6.8 million sterling for 1995.

The figures were more than £10 million better that the previous year, when the yard reported losses of £16.9 million, and ahead of expectations.

There had been speculation that the troubled yard would produce results worse than last year. Yesterday's figures add to hopes that the shipyard is likely to improve its financial position after several difficult years.

Earlier this week, it won a contract worth more than £100 million to construct a floating oil production vessel (FPSO) for use by BP in the Atlantic off the Shetlands and there are hopes of further orders.

A spokesman for H & W described the figures as "disappointing". However, he added that a change in direction from seeking contracts to build oil tankers to focusing on the oil and gas industry "offers the best opportunity to create a profitable future".

The losses were attributed to a failure to complete two ship at the projected cost, paint problems with two previously delivered ships and increased losses by the ship repair division.

In a joint statement to shareholders, chairman Mr Fred Olsen and chief executive Mr Per Nielsen said the group has repositioned to focus on the market opportunities associated with the requirements of the offshore oil and gas industries".

The market for FPSOs was not confined to new building, the statement said. Conversions of older tanker tonnage was a common development and the company had tendered for a number of North Sea contracts.