Delayed contract could shorten manufacturer’s cash runway to May

Trackwise Designs has revealed its cash runway could be as short as two months after a major contract was hit by delays.

The Tewkesbury manufacturer recently raised £4.75m through a heavily-discounted share placing but it has been hit by more problems.

An £8m contract with an unnamed electric vehicle manufacturer was due to be completed in July but there is now a redesign and validation process underway.

£4m was paid in advance last October and Trackwise Designs had expected to be receiving further payments from April.

It has revealed it expects changes to the payment schedule once the changes have been agreed.

In a statement, the company said: “In the event this expected Parts redesign and consequential production delay…are not resolved in the coming months, this would be expected to reduce the company’s previously announced cash runway to the end of May 2023, or potentially later in the event of an amended payment profile from the EV OEM.”

Trackwise Designs makes specialist products using printed circuit technology for the automotive, aerospace, medical and industrial sectors.

It expects to report a pre-tax loss of £7.7m for 2022, before an impairment charge related to writing off its investment in Stevenage Circuits.

The AIM-listed company has seen its share price drop 80% in four months, and 99% in just over two years. Its closing price last night of 1.15p valued the company at £6m.