Surface Transforms profit to be hit by weaker than expected revenue

12th Jun 2014 08:24

AIM-listed Surface Transforms has disappointed investors with its full-year revenue total, which at £1.3m came in below market expectations and will have a negative effect on estimated loss before tax for the 12-month period. A pre-close trading statement from the carbon technology firm explained that while good progress was being made on what it described as "crucial game changing contracts", it experienced an underperformance by the original distributors of its retrofit/aftermarket sales. The problem was identified last year, but despite a number of changes being made the generation of new sales has been at a slower rate that it originally anticipated. Chairman David Bundred said: "Surface Transforms continues to pursue parallel and complementary strategies; in the short term the aftermarket/retrofit segment is crucial to both short term break-even and securing road mile experience of the company's products, but ultimate shareholder value will arise from winning a significant mainstream contract with an original equipment manufacturer (OEM)."It's strategy going forward it to appoint more distributors, while at the same time pursuing sales opportunities with "near-OEMs", particularly in Germany. It revealed it was making progress with an aerospace customer and two automotive customers.Shares had plunged 19.11% to 9.10p by 08:33 on Thursday.NR