Turbo Power Systems year-to-date losses widen, despite stronger third quarter

Order intake and revenue have picked up at Gateshead power solutions firm, but nine-month figures paint a less encouraging picture

Charles Rendell, chief finance officer for Turbo Power Systems
Charles Rendell, chief finance officer for Turbo Power Systems

Gateshead-based power solutions company, Turbo Power Systems Inc., looks set to report widening year-on-year operating losses for 2014, despite a pick-up in performance during the third quarter.

Financial results show order intake increased 86% in the three months ended September 30, compared to the previous three months, rising from £3.33m to £6.21m.

Revenue, meanwhile, grew 3%, from £4.16m to £4.29m, while gross profit rose 56% to £1.28m, compared to £820,000.

However, figures for the nine months to September 30 show an overall year-on-year revenue reduction of 17% to £11.75m.

The company’s operating loss before other operating income, meanwhile, increased 30% to £2.1m, compared to £1.61 the year before.

Turbo Power Systems designs and manufactures innovative power solutions, its products being based on its core technologies of high speed motors and generators, as well as electronics, which are sold into sectors including aerospace and rail.

Chief executive Carlos Neves said: “We are pleased that order intake grew in Q3, as certain expected orders delayed from the first half of 2014 started to come through.

“Gross margin increased in the quarter, mainly due to increased production selling prices and our first intellectual property licensing contract.

“We continued to implement our strategy of bidding for profitable production and development contracts, whilst maintaining a disciplined approach to costs, which has resulted in a reduction in our total expenses by 12% quarter-upon-quarter and significantly improved the level of cash outflows from operations.

“We continue to see opportunities available where TPS’s excellence in the manufacture of innovative designs and its ability to implement new ideas are valued by our customers.”

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