Surface Transforms plummets on revenue downgrade

The AIM traded ceramic brake disk manufacturer now expects to report full-year revenues of approximately £1.0m, down from £1.4m for the year before, as revenues of approximately £0.25m that had been budgeted for FY19 are now expected to fall in FY20.

The revenues relate to compensation claims for delays with OEM 6's start of production, while three near-OEM customers have also recently suffered either delayed start of production or production problems, threatening £0.35m of FY20 revenues.

Kevin Johnson chief executive of ST, said: "It is always disappointing to be reducing guidance but it is important to stress that none of the above impacts the future potential business with OEM 5 or OEM 3 or the new model at OEM 6. Furthermore the bulk of the changes do not reflect any changes to our ambitions or longer-term expectations in the aircraft or near OEM-market. The company continues to see a significant business in both segments and will continue to vigorously pursue these opportunities."

ST's management also continue to await the outcome of discussions between a landing gear manufacturer, airframe builder and the US Department of Defence regarding its request for pre-funding before undertaking any further work on its aerospace project.

The company had previously budgeted £0.2m revenue in FY20 from this project, but has now removed this income from current forecasts.

Surface Transforms' shares were down 15.69% at 10.96p at 1143 BST.