After a torrid two years during which it has admitted ‘material uncertainty’ about its future, directors of Liverpool city region supercar brake disc maker Surface Transforms believe it is ready to accelerate to profitability. Tony McDonough reports
Supercar brake disc maker Surface Transforms (ST) has raised its revenue forecast for 2025 by 10% and appears ready put its significant troubles behind it.
On Tuesday stock market-listed ST, which operates from a factory in Knowsley, revealed its results for the six months to June 30, 2025. They show a 72% increase in revenues to £8.1m and narrowing pre-tax losses of £5.6m against £7.6m in the same period in 2024.
Its gross margin improved to 64% from 56% last year due to higher pricing and increased yield, particularly in Q2 together with reductions in the unit cost of manufacture.
Investment in new capacity in the first half of the the year offers brighter prospects for the full year, although cash is still having to be carefully managed.
Chief executive Kevin Johnson said: “Output and revenue have improved significantly with expectations for the full year now at c.£20m, broadly 10% ahead of previous management guidance.”
ST manufactures carbon fibre reinforced ceramic automotive brake discs for high performance cars. Customers of the business include, or have included, Porsche, Ferrari, Jaguar Land Rover and Aston Martin.
It currently has a forward order book of £390m and says its prospective customer pipeline is worth around £700m. However, despite the popularity of its products in 2023 ST experienced what it described as “the most difficult year in the history of the company”.
It has been dogged by issues related to the ramping up of production and those troubles continued into 2024. Earlier in the year the company tested the patience of its investors further by tapping them for an extra £9.5m.
In June the Alternative Investment Market firm, which employs around 170 people, posted its financial results for the 12 months to December 31, 2024. They revealed a 13% rise in revenues to £8.5m.
However, the full results revealed pre-tax losses of almost £23.9m, against losses of £20.6m in the previous year.
Kevin Johnson also said in the report: “2025 continues to be a year of transformation both in terms of scaling up production and improving processes. The business is making substantial progress towards sustainable and profitable operations.”
He went on: “Our customers continue to be highly supportive and collaborate closely with us. They understand the challenges of building capacity and achieving higher yields and are encouraged by what they are observing with the improving output and capacity.”
Cash at 30 June 2025 stood at £1.2m. In late 2023 the firm secured a £13.2m ERDF loan from Liverpool City Region Combined Authority. By June 30 this year £9.8m had been drawn down and the balance is expected to be fully invested by the end of 2025.
Installation of an additional furnace, which alleviates the most significant capacity constraint has been progressing throughout 2025. ST expects the furnace will be commissioned and supporting 2026 revenues and production output.
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“The company is developing means to release cash tied up in working capital through ongoing discussions with key customers and suppliers to optimise payment terms and to drive down inventory levels,” said Kevin.
“…The strategic objectives of building further capacity and improving yield remain crucial, but cautious steps forward are taking the business into a more robust state.”