Carbon Revolution, based in Geelong, had revenue of $38.9 million in the 2020 financial year but the after-tax loss was $114 million, an increase of 319 per cent over the $27.2 million loss made in the previous financial year.
The financial results were hit by COVID-19 issues including rising freight costs and quality issues during production as well as foreign currency movements.
But CEO Jake Dingle said the company now has 11 contracts with five global OEMs and is expected to make a gross profit in the second half of the current financial year.
Of the new contracts, one is for a premium SUV manufacturer while an Asia-based customer is expected to join the production roster in the current year.
Mr Dingle said six of the 11 wheel programs have been publicly announced by the relevant vehicle manufacturers and are in production and the company has also progressed the design of wheels for the CH-47 (Chinook) helicopter for the Australian Defence Force.Mr Dingle said the company had continued to build customer relationships with the addition of three new wheel programs.
There was also “significant progress” with the engineering and development of a new contract with an Asian vehicle manufacturer.
In its report to the ASX, Carbon Revolution said it had a range of strategic growth opportunities that would be enhanced by the scaling up of its Geelong manufacturing facility to increase production capacity.
“The company aims to leverage its technology into adjacent industries, such as the aerospace and transportation sectors, and will continue to invest in this during the current financial year,” Mr Dingle said in his report.
“We also made significant progress in our production processes, which are contributing both to manufacturing efficiency and product quality.
“We delivered very strong growth for the year, notwithstanding the significant challenges posed by COVID-19, which impacted our customers, supply chains, and production processes.
“I am pleased that our customers are now back in production and global supply chains appear to be functioning reasonably well again.”
The company made 13,942 carbon-fibre wheels in the past financial year and during the period, increased production speed to an annualised level of 30,000 wheels.
In its report to the Australian Securities Exchange (ASX), the company said sales from new wheel programs contributed 38 per cent of wheel sales revenue in the past financial year. The average price of each wheel rose nine per cent to $2643 in the 2020 financial year.
It said these wheel programs will deliver further growth in the current year as they will be in production for a full year.
By Neil Dowling
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