Surface Transforms Faces Cash Flow Challenges

Surface Transforms plc, a leading manufacturer of carbon fiber-reinforced ceramic brake discs, has provided a financing, trading, and operations update for the year ending December 31, 2024. Despite financial constraints impacting operations, the company continues to receive strong support from key customers.

Key Highlights

Customer Support: Ongoing engagement with customers has led to increased pricing, financial backing, and over £4 million in cash advances for 2025 to support working capital.
Revenue Growth: FY24 revenue reached £8.2 million, up from £7.3 million in 2023 (subject to audit).
Cash Flow Constraints: Gross cash stood at £0.5 million at year-end, with working capital limitations affecting both revenue and manufacturing efficiency.
Capital Expenditure: Approximately £5.5 million was invested in FY24, with a £13.2 million loan secured for capital improvements—£4.9 million drawn down by year-end.
Operational Challenges: Yield fluctuated between 52% and 78%, below the target of 86% for Q4, due to supply chain restrictions and cash flow issues.

CEO Statement

Kevin Johnson, CEO of Surface Transforms, acknowledged the significant hurdles in scaling production and meeting demand, stating:

“There remain numerous challenges to grow output and revenue at the pace required. The Company, alongside customer support, is working through each of these difficulties, not least those posed by cash constraints that have limited our ability to operate. Frustratingly, our efforts have not yielded the results we expect of ourselves or at the levels of demand our customers require. As the Company navigates these difficult times, the support of our customers remains steadfast and highly encouraging. These Q4 results are not typical and do not reflect the progress achieved during 2024 as a whole. We remain optimistic that we can firstly, find a solution to current working capital constraints and thereafter, achieve the necessary operational volumes and targets.”

About Surface Transforms

Surface Transforms is the UK’s only carbon-ceramic brake disc manufacturer and one of only two global suppliers in the industry. The company’s proprietary Carbon Ceramic Technology produces lighter, more durable, and heat-efficient brake discs for high-performance vehicles. Unlike competitors that use chopped carbon fiber, Surface Transforms interweaves continuous carbon fiber, resulting in stronger and longer-lasting brake components.

The company’s carbon-ceramic discs offer significant advantages over traditional iron brakes, including: