REG - Surface Transforms - Trading and operations update

Surface TransformsAnnouncement

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RNS Number : 3229P  Surface Transforms PLC  19 January 2026

The information communicated within this announcement is deemed to constitute
inside information as stipulated under the Market Abuse Regulations (EU) No.
596/2014 as it forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the
Company's obligations under Article 17 of MAR. Upon the publication of this
announcement, this inside information is now considered to be in the public
domain.

 

Surface Transforms plc

("Surface Transforms" or the "Company")

 

Trading and operations update

Surface Transforms (AIM: SCE) manufacturers of carbon fibre reinforced ceramic
automotive brake discs, announces the following unaudited trading and
operations update for the year ended 31 December 2025 ("FY25").

Trading update

·     Revenue - increased circa 120% to £18.0m (FY24: £8.2m)
representing further ongoing improvement with a record second half revenue of
£9.9m, up from £8.1m in the first half of 2025.

·     Operating loss before interest and tax- reduced nearly threefold to
approximately £8.7m (FY24: £23.4m), with second-half losses improving
significantly to £3.5m (H1-25: £5.2m loss).

·      Gross cash - £1.0m(1) as at year end (FY24: £0.5m) which
continues to be actively managed.

·     Capital expenditure - increased to £8.6m (FY24: £6.1m) with the
£13.2m ERDF loan now fully utilised for capital investment in line with
management expectations.

·      Outlook - revenue expectations of approximately £27.0m for FY26.

·      Customer prepayments - £13.3m at the year end, marginally higher
than the £12.9m as at 30 June 2025.

(1 )Includes £0.2m restricted for capital expenditure

Operations update

The Company has continued integrating new equipment, automation, and process
improvements during Q4 25. As expected, this temporarily impacted yield, which
was 77% in Q4, up from 70% in Q3 and a marked improvement from 49% in Q1.
This was below management's internal 80% target which remains for Q1 2026. The
range of weekly yield performance continued to improve during the second half,
indicating that the transformation and experience applied to the issue is
taking effect. Except for additional furnace capacity, all major improvement
programs are now nearing completion, and no further significant changes are
planned in the near term. Installation and commissioning of the new furnace
is well advanced, and it is expected to be operational by the end of Q2 2026,
supporting increased revenue and production output thereafter.

Summary and outlook

FY25 has been a transformative year, marked by substantial progress in scaling
production and improving processes. The business has moved meaningfully closer
to substantial and profitable operations, with materially higher output and
revenues. Demand for our product remains strong. While challenges persist,
customers are encouraged by the improvements underway. Cash remains tight but
manageable.

The business is well positioned for growth in 2026, and management expects to
deliver FY26 revenue of approximately £27.0m with an EBITDA breakeven.

 

For enquiries, please contact:

 Surface Transforms plc                                        +44 151 356 2141
 Kevin Johnson, CEO
 Steve Harrison, CFO

 Zeus (Nominated Adviser and Broker)                           +44 203 829 5000
 David Foreman / James Edis / Ed Beddows (Investment Banking)
 Dominic King (Corporate Broking)

About Surface Transforms

Surface Transforms plc. (AIM:SCE) develops and produces carbon‐ceramic
material automotive brake discs. The Company is the UK's only manufacturer of
carbon‐ceramic brake discs, and only one of two mainstream carbon ceramic
brake disc companies in the world, serving customers that include major OEMs
in the global automotive markets.

The Company utilises its proprietary next generation Carbon Ceramic Technology
to create lightweight brake discs for high‐performance road and track
applications for both internal combustion engine cars and electric vehicles.
While competitor carbon‐ceramic brake discs use discontinuous chopped carbon
fibre, Surface Transforms interweaves continuous carbon fibre to form a 3D
matrix, producing a stronger and more durable product with improved heat
conductivity compared to competitor products; this reduces the brake system
operating temperature, resulting in lighter and longer life components with
superior brake performance. These benefits are in addition to the benefits of
all carbon‐ceramic brake discs vs. iron brake discs: weight savings of up to
70%, longer product life, consistent performance, reduced brake pad dust and
corrosion free.

The Company holds the London Stock Exchange's Green Economy Mark.

For additional information please visit www.surfacetransforms.com
(http://www.surfacetransforms.com/)

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