Shaky start but Surface Transforms looking forward to a “robust” 2022

Brake specialist Surface Transforms remains confident of a “robust” 2022 despite short-term challenges.

Reporting its half year results for the six months to end of June, the Liverpool company which makes ceramic brake discs for supercars, reported pre-tax losses had widened from £1.2m in the previous year to £1.9m on revenues of £1.2m, which were 34% up on last year’s £900,000.

During the six months Surface Transforms also raised £19m of new equity (after fees) in a heavily over-subscribed fund raise.

Production also commenced for the Aston Martin Valkyrie.

The company now expects to enter a period of high growth, “partially, but not solely based on a lifetime value OEM order book of circa £70m.”

However, the immediate 2021 outlook is driven by the background combination of customer start of production dates (SOP) and the subsequent “ramp” of production from SOP to mature manufacturing volumes.

It said: “In neither case can we be totally certain of the customers’ projections. It is not uncommon for SOP dates to be delayed and the ramp varies both by customer and is specific to each individual customer circumstances.

“These uncertainties are impacting our view of the outlook for 2021.”

However, the group said despite the short-term uncertainties, the forecast for 2022 has become “more robust.”

It said a new production cell at its 55,000 sq ft manufacturing facility, enabling it to fulfil demand from new and existing customers, will be ready for the ramp up in sales forecast in Q4-2021.

A shake-up to the company’s manufacturing strategy is expected to save £10m in the subsequent equipping of the Knowsley site; provide £50m of annual sales capacity in early 2023, an increase of £15m from previous capacity forecast and reduce our projected carbon footprint.