- Brake discs manufacturer Surface Transforms posted a loss for the seven-month period through December amid a rise in R&D spending.

The company published a seven-month report for a transitional period from an 31 May reporting date to a new date of 31 December.

Pre-tax losses for the period amounted to £1.32m, compared to losses of £1.57m on-year.

Revenue rose to £1.45m, up from £0.94m, though gross margin contracted to 59.8%, back from 63.0%.

Surface Transforms said it was 'still on progress' to reach positive adjusted earnings before interest, tax, deprecation and amortisation in 2021 and pre-tax profit in 2022.

'The company has been able to maintain operations during the current crisis and, due to the quick response of the entire team, have managed to keep the factory operational throughout the lockdown phase of the crisis,' Surface Transforms said.

'No orders with OEM's or near OEM's customers have been lost, and indeed in this period the company announced a contract in excess of £5m from Koenigsegg for their new Gemera car.'

'However there have been delays to both some start of production dates and the initial production ramp up rates.'

'Additionally, there has been some slowing of retrofit sales but this is expected to be a temporary position that will recover as lockdowns across the world are slowly lifted.'

'The trading impact of the pandemic was fully described in the background provided to investors at the time of the April 2020 Covid-19 statements and fund raising and has not changed since that time.'

'Against this background the company has, after the period end, raised £2.25m net after fees through a significantly over subscribed placing and open offer which has placed the company in a secure position to mitigate the risks that the Covid-19 pandemic could create and ensures that it can maintain the development activities to support current and potential new OEM contracts.'

'The company did apply for a government backed CBILS loan but understands that historic trading performance renders the Company ineligible.'

'This was the management assumption at the time of the equity fund raise and has no impact on the internal projections and previously provided guidance.'

At 9:00am: [LON:SCE] Surface Transforms PLC share price was +1p at 21.5p

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