Surface Transforms PLC Trading Update (2658S)
03 Novembre 2023 - 8:05AM
UK Regulatory
TIDMSCE
RNS Number : 2658S
Surface Transforms PLC
03 November 2023
This information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
3 November 2023
Surface Transforms plc
("Surface Transforms" or the "Company")
Trading update
Surface Transforms (AIM:SCE), manufacturer of carbon fibre
reinforced ceramic brake disc materials provides the following
trading update for the ten months to 31 October 2023 and revised
outlook for the 2023 financial year.
Sales in the four months to 31 October 2023 were GBP3.0m
bringing year-to-date sales for the period to 31 October 2023 to
GBP6.3m. Whilst October sales of GBP1.0m was the best month of
sales in 2023, it was lower than management had previously budgeted
.
The previously reported technical problems have now been
overcome. However, we continue to face some challenges in our
production line, including single points of failure and a learning
curve on the maintenance of our new equipment. These challenges,
which are being resolved, are hindering us from creating sufficient
capacity resilience and are constraining our production ramp
up.
Consequently, the Company is prioritising new capacity on these
single failure points whilst building up work-in-progress buffer
stocks to mitigate the learning curves on key pieces of equipment
unique to us. In parallel to these actions, revised operating
processes and training has been accelerated to deal with improving
maintenance of key pieces of equipment. The Company has also made
significant changes to Operations Management, including but not
limited to, the appointment of a new Chief Operating Officer,
Stephen Easton.
Outlook
Output continues to increase, and as noted above October was the
best sales month in 2023 but not yet at the desired rate. In the
light of these challenges, the Company is now planning its cash
needs and customer commitments based on a shallower ramp and now
expects to reach the required rate of production in Q1 2024, later
than previously forecast. As a result, the Company is reducing its
sales guidance for the year to December 2023 to GBP8.6m. Overall,
the outlook for 2024 to 2027 continues to remain very positive
reflecting contracts in series production and recent new business
announcements, with capacity being installed to fulfil these
awards.
Progress on installing new capacity
The Company is continuing to install the capacity (capital
expenditure of approximately GBP8m in 2023 and GBP9m in 2024)
required to both meet increasing customer demand and providing the
necessary resilience to overcome single points of failure. The
Company remains on course to have capacity equivalent to GBP50m
sales per year run rate in 2024 and for GBP75m sales run rate in
2025. Additionally the Company is well advanced with its plans for
the next phase aimed at progressively providing GBP150m of sales
capacity by 2027.
Potential loan finance
To finance its capital expenditure plans, the Company is in
advanced discussions on a GBP13m capital expenditure loan that
would be released as new capacity is expended in 2024 and 2025 but
cannot be used for working capital purposes. The outcome of these
discussions is not certain but is expected to conclude before the
end of 2023. Success in securing the loan will enable the Company
to finish installing the current capacity build to GBP75m as well
as commencing the next stage of the capacity build towards GBP150m
sales capacity; however there remains the need to finance the
working capital of the significant sales increase over the next few
years.
Kevin Johnson (Chief Executive Officer) said: "These ongoing
production issues are frustrating for all of us, particularly as
the issues are not, in themselves, insurmountable. The revision to
our plan for 2023 both reflects recent performance and provides
certainty for our customers over the next six months. Our customers
continue to understand the issues we are facing with the pace of
the sales increase, as evidenced by the recent announcement of our
biggest ever nomination."
For enquiries, please contact:
Surface Transforms plc +44 151 356 2141
David Bundred, Chairman
Kevin Johnson CEO
Isabelle Maddock CFO
Zeus (Nominated Adviser and Joint Broker) +44 203 829 5000
David Foreman / Dan Bate / James Edis (Investment
Banking)
Dominic King (Corporate Broking)
Cavendish Capital Markets Ltd (Joint Broker) +44 20 7220 0500
Ed Frisby / Abigail Kelly (Corporate Finance)
Andrew Burdis / Harriet Ward/Barney Hayward
(ECM)
About Surface Transforms
Surface Transforms plc. (AIM:SCE) develops and produces
carbon--ceramic material automotive brake discs. The Company is the
UK's only manufacturer of carbon--ceramic brake discs, and only one
of two mainstream carbon ceramic brake disc companies in the world,
serving customers that include major OEMs in the global automotive
markets.
The Company utilises its proprietary next generation Carbon
Ceramic Technology to create lightweight brake discs for
high--performance road and track applications for both internal
combustion engine cars and electric vehicles. While competitor
carbon--ceramic brake discs use discontinuous chopped carbon fibre,
Surface Transforms interweaves continuous carbon fibre to form a 3D
matrix, producing a stronger and more durable product with improved
heat conductivity compared to competitor products; this reduces the
brake system operating temperature, resulting in lighter and longer
life components with superior brake performance. These benefits are
in addition to the benefits of all carbon--ceramic brake discs vs.
iron brake discs: weight savings of up to 70%, longer product life,
consistent performance, reduced brake pad dust and corrosion
free.
The Company holds the London Stock Exchange's Green Economy
Mark.
For additional information please visit
www.surfacetransforms.com
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
TSTNKBBBBBDBQDK
(END) Dow Jones Newswires
November 03, 2023 03:05 ET (07:05 GMT)
Grafico Azioni Surface Transforms (LSE:SCE)
Storico
Da Apr 2024 a Mag 2024
Grafico Azioni Surface Transforms (LSE:SCE)
Storico
Da Mag 2023 a Mag 2024