Wheel firm $17m in the red
CARBON Revolution has posted an underlying loss of $17.1m — despite a 167 per cent increase in revenue from sales of its Geelong-made hi-tech wheels.
The impacts of the coronavirus pandemic have forced the world’s only industrial carbon fibre wheel manufacturer to push its projection for operating at a profit back to next year.
The company sold 13,942 wheels in the 12 months to June 30, generating $36.8m, with new programs for the Ford Mustang GT500, Ferrari SF90 Stradale and Renault Megane RS Trophy-R contributing 38 per cent of wheel sales revenue.
Engineering and tooling brought in a further $2.1m to take Carbon Revolution’s fullyear revenue to $38.9m, up from $15.1m in FY19.
However, an increase in costs from $22.5m to $50.5m led to an underlying loss of $17.1m, not including one-off costs of $87.2m relating to its initial public offering and listing on the ASX late last year.
Due to the impact of COVID-19 on key clients, the financial result was short of the company’s forecasts prior to its listing, which were revised in March, of making more than $60m in FY20.
Carbon Revolution chief executive Jake Dingle said the three new wheel programs would deliver growth in the next 12 months as they went into full production and there had also been significant progress with the engineering and development of a new contract with an Asian vehicle manufacturer.
“I am pleased that our customers are now back in production and global supply chains appear to be functioning reasonably well again,” Mr Dingle said.
In the next 12 months Carbon Revolution is targeting new supply arrangements with existing customers for new vehicle wheel programs as well as new customers in Europe, North America and Asia.
“We expect that a number of new cars will be launched with our wheels,” Mr Dingle said.
Carbon Revolution is now nominated for, or has been awarded, 11 wheel programs with five global vehicle manufacturers.
The company told investors that the full benefits of its industrialisation program are yet to be realised.