Surface Transforms plc (LON:SCE), manufacturers of carbon fibre reinforced ceramic materials, have today provided the following pre close trading and operations update for the year to 31 December 2021 (“FY2021”).
Trading update
Revenue for FY2021 grew 20% to £2.4m (2020: £2.0m). Cash at 31 December 2021 was £13.0m; however, this includes a £3.1m irrevocable letter of credit in the name of a furnace manufacturer which will be progressively drawn down, by the supplier, as furnace manufacturing milestones are met. Other interest-bearing loans and asset finance totalled £1.8m (2020: £0.7m), the increase primarily reflecting the Company’s acceptance of a local government loan on attractive terms, as described in the Company’s announcement released on 24 March 2021.
The Company’s final results for FY2021 will be reported in April 2022.
New capital equipment update
Surface Transforms is pleased to announce that, at the end of January, daily assembly volumes reached the initial management targets in the production plan required to reach market revenue expectations for 2022. The Company has addressed the specific production issue on the particularly complex furnace described in the 14 December 2021 announcement. Several satisfactory production batches having now been produced in late December and January.
Following this success, operational focus has moved on. As with all manufacturing processes the system must be filled, which in our case takes some weeks and this was completed in January. This system fill and production ramp up involved “downstream” manufacturing stress testing with the objective of identifying and resolving any further capacity constraints and engineering challenges. This production ramp up is now in line with management targets and manufacturing engineering activity will continue through Q1 and Q2 2022.
Capital markets day
The Company also intends to invite shareholders to see the new equipment on-site on a capital markets day to be held shortly after the FY2021 results have been announced. Further details will be provided in due course.
David Bundred Surface Transforms Chairman: “This year will be transformational for the Company as we move into profitability. We are delighted with the progress made in January, and by the success the team had in its response to the problematic furnace. Given our order position, the priority is now production, and the Board is confident in the Company’s ability to deliver on the excellent opportunity ahead.”
