Business
Trading, Premises and Operating Update
Trading, Premises and Operating Update.
About this update from Surface Transforms Plc
[{"type":"text","content":"\n \nRNS Number : 1923B Surface Transforms PLC 15 June 2016 \n\n15 June 2016\nSurface Transforms plc\n(\"Surface Transforms\", the \"Company\" or the \"Group\")\nTrading, Premises and Operating Update\nSurface Transforms (AIM: SCE) ), manufacturers of carbon fibre reinforced ceramic brake discs, announces that revenue in the year ended 31 May 2016 was in line with expectations of £1.4 million (2015: £1.1 million). Margins and costs are also expected to be in line with expectations but income from R&D and investment grants and credits was about £100k below plan.\nThe increase in sales was primarily driven by an increase of 25% in sales to retrofit customers in 2016 of £384k (2015: £306k), a 55% increase in sales to near OEM customers of £174k (2015: £112k) and a one-off increase of approximately £142k in aerospace development revenues. All other customer sales were approximately in line with the previous year.\nThe cash position as at 31 May 2016 was £4.8m (2015: £0.8m), while the Board anticipates receiving an R&D tax credit in excess of £250k (2015: £306k) in the next four months in addition to previously announced £500k in grants and interest free loans from local authorities in support of our capital investment.\nPremises update\nThe Company has now formally signed the lease on its new Knowsley premises and ordered equipment (including the payment of deposits) for the new factory with a total investment cost of £3.1m. The actual order value of the equipment is in line with budget. The Company will begin disassembling the equipment in the existing Ellesmere Port factory in August for reassembly in Knowsley, with full vacation of the existing site planned for February 2017 in line with management expectations. \nOperating update\nIn respect of the five main automotive manufacturers the Group is working on or in discussions with:\nOEM 1 (British) Start of production (\"SOP\") on this limited edition car is expected in mid-2018, with first financial year (\"FY\") sales of £1.0m and a further £1.2m in the following financial year. If the further named vehicles in the currently agreed introduction schedule come on stream potential annual revenues would be expected to exceed £5m. For reasons unconnected with Surface Transforms this performance car customer has extended the vehicle freeze date of the first model by thre...