£100m New Business Award from OEM 10
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. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
16 October 2023
Surface Transforms plc
("Surface Transforms" or the "Company")
£100m new business award from OEM 10
Surface Transforms (AIM:SCE), manufacturers of carbon fibre reinforced ceramic automotive brake discs, is pleased to announce that it has been notified of its selection as a tier one supplier of a carbon ceramic brake disc to its existing mainstream customer described previously as OEM 10, one of the world's largest automotive OEMs.
The selection is for Surface Transforms to be the sole supplier of the carbon ceramic brake disc on both axles of a range of new electric vehicles with common axles. The award covers vehicles where the product is standard fitment as well as vehicles where it is an option. The lifetime revenue on this range of models is expected to exceed £100m with series production planned for 7 years. The Company expects series production to commence in 2027. The contract is priced in GBP.
The vehicle range was part of the Company's substantial prospective contract pipeline which having now converted increases the value of our awarded lifetime contracts to over £390m.
This OEM 10 contract will require capacity beyond both the current factory footprint and the phase 2 capacity investment program, forecast to provide £75m per year sales capacity in 2025. The timing of this award gives the Company sufficient time to implement the third phase of our capacity expansion to provide £150m per year of total sales capacity. Planning for this third phase continues to be actively progressed and updates will be provided in due course.
Kevin Johnson, CEO commented: "This most welcome nomination, is the Company's largest to date, deepening our relationship with the customer. The selection process was intensely competitive and set against the recent Surface Transforms production ramp-up challenges. This success further illustrates the advanced technical capabilities of our products. The trend for follow-on awards with existing customers is something we have seen across all our customers. Our healthy prospective contract pipeline is mainly made up of existing customer programmes and is expected to continue to fuel our growth and capacity expansion plans into the future".
For enquiries, please contact:
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Surface Transforms plc |
+44 151 356 2141 |
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David Bundred, Chairman |
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Kevin Johnson CEO Isabelle Maddock CFO
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Zeus (Nominated Adviser and Joint Broker) |
+44 203 829 5000 |
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David Foreman / Dan Bate / James Edis (Investment Banking) |
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Dominic King (Corporate Broking)
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Cavendish Capital Markets (Joint Broker) |
+44 20 7220 0500 |
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Ed Frisby / Abigail Kelly (Corporate Finance) |
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Andrew Burdis / Barney Hayward (ECM) |
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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 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 is accredited with the London Stock Exchange "Green Economy Mark"
For additional information please visit www.surfacetransforms.com
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