Surface Transforms (SCE) H2 2024 earnings summary

Executive summary

• Revenue grew 13% to £8.2m in 2024, driven by a 21% increase in disc sales, but operational challenges led to a net loss of £22.3m and a gross margin decline to 50%.

• Significant customer and shareholder support was secured, including £9.5m equity raised and £1.6m in customer cash advances.

• Production yield and operational efficiency improved post-year-end, with Q2 2025 yield reaching 80%, above the 77% annual target.

• Capital investment of £6.2m in 2024 supported manufacturing upgrades, with a further £8.2m planned for 2025.

• Leadership changes included a new Chairman and interim CFO appointments.

Financial highlights

• Revenue: £8.2m (2023: £7.3m), up 13% year-over-year.

• Gross margin: 50% (2023: 57%), impacted by product mix and cost pressures.

• Net loss after tax: £22.3m (2023: £19.6m).

• Loss per share: 2.31p (2023: 7.92p).

• Cash at year-end: £0.5m (2023: £6.1m); cash used in operations: £14.0m.

• Impairment charge: £6.5m (2023: £9.2m) across fixed and intangible assets.

Outlook and guidance

• 2025 expected to show continued growth from increased capacity and yield improvements.

• Management targets cash-positive monthly flows in H2 2025, but material uncertainty remains over yield, cost control, and commercial agreements.

• Full-year 2025 outlook aligns with base case revenue and EBIT expectations.