Just weeks after admitting ‘material uncertainty’ over its future Liverpool city region supercar brake disc maker Surface Transforms hails a ‘pivotal change’… so has it finally turned a corner? Tony McDonough reports

 

After two torrid years supercar carbon fibre brake disc maker Surface Transforms (ST) may finally be seeing some light at the end of the tunnel.

With a forward order book of £390m the Liverpool city region business makes a product that has seen most of the world’s major automotive manufacturers beat a path to its door. They simply love its brake discs which significantly outperform traditional discs.

Customers of the firm, which employs around 170 people at its factory in Knowsley, include, or have included, Porsche, Ferrari, Jaguar Land Rover and Aston Martin. It should be riding high.

However, persistent problems in ramping up production have pushed the company to crisis point. In early June it admitted “material uncertainty that may cast significant doubt over the company’s ability to continue as a going concern”.

In 2023 ST experienced what it described as “the most difficult year in the history of the company”. In June this year the listed company revealed its annual results for the year to December 31, 2024, to the Alternative Investment Market.

They showed pre-tax losses of almost £23.9m, against losses of £20.6m in the previous year. There was a 13% rise in revenues to £8.5m. At that time chairman Ian Cleminson said the business had shown “incredible resolve”.

And that resolve may finally be leading to some progress. In a trading update to the market on Tuesday, ST hailed a “pivotal change in manufacturing yield and output”. It added revenue for the first half of 2025 was likely to be £8.1m – 72% higher than 2024.

Average manufacturing yield has increased to 77% in Q2 2025 from 49% in Q1 2025. It has delivered reductions in process variation and production disruption in Q2 2025, resulting in significant yield improvements.

In the update it said: “It is important to note that at current levels of average yield, we have sufficient installed manufacturing capacity to deliver to customer order patterns and become financially sustainable.”

Key customers, it added, “have and continue to be highly supportive”. Their support has facilitated the operational progress achieved during the first half 2025 including total cash advances to 30 June 2025 of £12.9m.

ST remains in negotiations regarding the settlement of these advances, with repayments expected to commence in the second half of the year.

It added: “Careful cash management has been required to support the operational improvements made in yield, output and trading.

“While operational improvements are easing cash constraints, we remain focused on steadily managing our way through the remainder of this year with discipline.”

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.

“The company is focused on sustaining these new levels of operational performance with H2 2025 revenues forecast to grow by approximately 20% compared to H1 2025,” Tuesday’s statement added.

 

 

It also said Stephen Easton has decided to step down from his role as chief operating officer. He has been replaced by Gareth Laker, effective from August 1. Gareth has been with Surface Transforms for two years as the manufacturing technology manager.

Chief executive Kevin Johnson said: “Since November 2024, the board has been focused solely on operational improvement and cash management. During Q2 2025 we started to deliver sustainable improvements in output, yield and quality.

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“We are cautiously confident this level of performance will be maintained in the second half of the year and beyond. We remain mindful that there is room for further operational improvements which in turn will ease the financial stress the business has endured.

“The support of customers has been unwavering, and it is hugely appreciated. Shareholders have remained patient, and we are focused on delivering value to them.

“Every member of the Surface Transforms team has shown incredible resilience through challenging times, and I am delighted that we are now realising the rewards of their hard work.”