Record results and a supercar contract win for Sevcon

Record results and a supercar contract win for Sevcon

Gateshead-based low carbon vehicle firm, Sevcon, has seen sales soar after a revenue boost from its recent Italian acquisition.

Turnover was up over 10% to $22.3m (£15.4m) in the first six months, compared with $20.3m (£14.04m) in the first six months of the previous financial year.

On unveiling its latest figures, Sevcon also announced it had secured a new major contract with a world-leading  performance car company, which has the potential to deliver over $40m (£27.66m) of sales over five years.

Sevcon CEO Matt Boyle said: “We reported strong revenue growth in the second fiscal quarter due to the acquisition of Bassi, which more than offset slower sales of our traditional controllers and capacitors.

"The lower traditional sales were due to continued weakness on the industrial side of the business as a result of macro-economic conditions and customers reducing inventory.”

Earlier this year, Sevcon purchased Italian battery charging business Bassi in a deal valued at over £10m.

Boyle said: “Our Bassi acquisition performed excellently and ahead of our expectations and the integration is proceeding well.

“Bassi reported $4m in sales since the January 29 acquisition, representing record months for the business.

“Adding Bassi's state-of-the-art battery charging technology and power management capabilities to Sevcon's advanced control technologies, significantly strengthens our ability to deliver the more integrated solutions that our markets and our customers are demanding.”

The company posted an operating loss of $1.5m, (£1.03m) after charging $1.4m (£968,000) in acquisition costs associated with Bassi, compared with operating income of $956,000 in the first six months of last year. 

Sevcon today announced it has been awarded a multi-year, multi-million dollar contract by a manufacturer of performance cars which will cover engineering time and materials and is set to last for four years.

Sevcon says the customer has provided a follow-on non-binding production forecast that contemplates up to $41m (£28.35m) in product purchases over a five year period following successful completion of the development phase, commencing in 2020.

Boyle said: “The multi-year on-road design contract that we secured from an automotive manufacturer is one of several similar design wins that give us confidence for significant sales growth in the future.

“This contract award is the latest in a series of on-road design wins which demonstrates the power of our Gen5 platform and Sevcon’s proven on-road experience.”

“We expect continued growth from Bassi throughout the year, and we are taking steps to increase production and accelerate that growth even further.

“We are executing well on our strategy to capitalize on the many opportunities related to the global demand for electrification, and we look forward to making further progress as we proceed in fiscal 2016.”