Hardide PLC's record revenues justify investment in capacity

(MENAFN- ProactiveInvestors) Hardide (LON:HDD) the provider of advanced surface coating technology has moved back into the black.

Results for the year to 30 September revealed a profit before tax of £110000 compared to a loss of £902000. Prior to Hardide's upbeat September trading update analysts covering the stock had expected a loss of around £300000.

Revenue performance was also better than the market had been expecting with the top line improving to £3.0mln from £2.4mln the year before; market consensus was for revenue of £2.8mln.

The group said the revenue performance reflects a return to order levels from a major customer that are more in keeping with that customer's long-term order history but also increasing demand from other existing customers and new accounts.

Cash improved to £3.47mln from £1.04mln a year earlier largely thanks to £2.5mln raised by a placing of shares in August.

Those funds are earmarked for an investment in increased capacity to meet future demand. The company said that since the end of the reporting period the installed capacity in the UK has increased by almost 50% while planning for a new production facility in North America is at an advanced stage.

Further investment in capacity has been budgeted for the current financial year.

A major share price catalyst for the group will be the successful completion of aerospace test and approval programmes with Airbus and AgustaWestland and Hardide said these tests continue to progress positively.

The Airbus testing programme in particular has dragged on for a considerable time but is now in the final stages before qualification the company revealed.

"The board is confident that the group is in a strong financial and operational position to continue the growth that has been achieved this year. That same strong financial position and growing demand merits the plan to reinstate production in North America" said Robert Goddard chairman of Hardide.