Resilient Surface Transforms is over last year’s growing pains
Surface Transforms has got over its “growing pains” and is confident it can fulfil its growing order book.
In a trading statement to the stock market this morning the Knowsley based carbon brakes manufacturer and supplier to the motor industry said that subject to audit, revenue for the final year to the end of December 2023 grew by 63% to £8.3m (2022: £5.1m).
In its April 2023 trading update the company revealed that one furnace issue in particular significantly affected output over the past six months, exacerbated by industry-wide supply chain problems for furnace insulation.
The business has gross cash of £6.1m, including the cash received from the December 2023 equity fundraising and £13.2m secured in a loan agreement for capital expenditure, none of which had been drawn down at the year end.
In the statement the company says “no new technical problems have arisen in recent months” and it plans to have capacity to service orders worth £50m by mid-year 2024 and £75m p.a. sales capacity by the end of 2025, to support existing contracts, expected growth and to build manufacturing resilience.
The statement didn’t refer to any profit numbers, but claimed revenues for 2024 would likely be £23m.
Chief executive Kevin Johnson said “After a very difficult 18 months, and whilst the need to build our resilience continues, we now believe that the worst of our growing pains are behind us. This view is shared by our customers who have agreed their schedules for 2024 which match our assessments of production capability and capacity.
“We continue to be capacity constrained not demand constrained, so our factory expansion remains a crucial task in positioning the Company for the future. It is therefore pleasing that the recent debt facility provides the foundation for the programme to continue apace. At the same time we are continuously improving operations to enhance productivity, thereby driving increased output in 2024, with the new senior leadership team in place to deliver these ongoing improvements in a timely manner. We want to thank the entire team throughout the business whose tireless efforts and skills have fuelled recent progress.”.
