Hardman Talks Video | Surface Transforms Manage...
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Hardman & Co Research
Hardman Talks Video | Surface Transforms Management Presentation On 15 September 2021, the Surface Transforms' management team gave a presentation to investors on Hardman Talks. Watch it here: https://youtu.be/8nx76kCudpc The presentation explored Surface Transforms' Interim Results, which were in line with guided expectations and confirm the major revenue growth in place, offering strong gross margins, with funding in place to expand. The major OEM 8 new contract is being taken to the start of production more rapidly than typical of other OEM contracts but the start date has been moved a few months later, probably just into 2022. The overall quantum is not affected; indeed, Surface Transforms indicates the risk is distinctly on the upside here. The new manufacturing strategy announcement of 2 September 2021 pointed to management's revenue profile expectations: "at the time of the fundraising we said that we thought there could be sufficient demand to fill the Knowsley factory by 2025 (£75m sales), albeit these projections are still uncontracted.we have now concluded that we may want this capacity by 2024″. Management states £50m pa sales is currently indicated as the potential, which is derived exclusively from current customer discussions and carry over trade (namely new models from existing customers). By 2024, £25m pa sales is indicated under current live contracts, with much more anticipated on top of this from imminent new contracts. This is a knowledge company, with high growth in a high growth market. Research expenses, including employees to PhD level, have always been a strong part of the equation to underpin growth. Surface Transforms is an applied metallurgy, chemistry and manufacturing process. 1H21 R&D increased 32%. There is only one competitor, a monopolistic supplier with 97% of the global market, falling to 93% next year. There are cogent arguments that this competitor product is outperformed by the ST product. There is no indication of a commercial third supplier and lead times are very many years; thus, additional competition would appear to be many years off. Watch the recording: https://youtu.be/8nx76kCudpc To be first in the know about Hardman & Co's latest digital events, subscribe to the mailing list here. The Hardman Talks series is designed to share the latest sector insights and company investment cases from our corporate clients and our expert team of analysts. Click here to subscribe to the Hardman Talks channel on YouTube. Hardman & Co | 1 Frederick's Place | London | EC2R 8AE | www.hardmanandco.com
Hardman & Co Research can still be accessed for free after MiFID II. About Hardman & Co: For the past 25 years Hardman has been producing specialist research designed to improve investors' understanding of companies, sectors, industries and investment securities. Our analysts are highly experienced in their sectors, and have often been highly rated by professional investors for their knowledge. Our focus is to raise companies' profiles across the UK and abroad with outstanding research, investor engagement programmes and advisory services. Some of our notes have been commissioned by the company which is the subject of the note; this is clearly stated in the disclaimer where this is the case. Hardman Research Ltd, trading as Hardman & Co, is an appointed representative of Capital Markets Strategy Ltd and is authorised and regulated by the Financial Conduct Authority; our FCA registration number is 600843. Hardman Research Ltd is registered at Companies House with number 8256259. Our research is provided for the use of the professional investment community, market counterparties and sophisticated and high net worth investors as defined in the rules of the regulatory bodies. It is not intended to be made available to unsophisticated retail investors. Anyone who is unsure of their categorisation should consult their professional advisors. This research is neither an offer, nor a solicitation, to buy or sell any security. Please read the note for the full disclaimer.
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1234713 20-Sep-2021
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