Sevcon reveals $400m contract pipeline

Gateshead electrification specialist Sevcon has recorded a 38 per cent increase in first quarter sales, after earlier unveiling a $400m (£320m) contract pipeline.

The record figures come days after the company announced its sixth major contract deal, the development of an electric drivetrain for an unnamed Chinese/European car maker worth up to $200m (£160m).

It has developed the drivetrain throughout 2016 and will now develop an inverter based on its existing Gen5 technology. The start of production is expected to be late 2018.

Sevcon reported revenues rose to $12.5m (£10m) in the first quarter of 2017, up from $9.1m (£7.3m) in the same period last year. However, losses were $2.4m (£1.9m) for the first quarter, compared with a profit of $180,000 (£144,000) in the first quarter last year.

Matt Boyle, Sevcon president and chief executive, said: "The operating loss reflects our significant investment in both engineering and sales and marketing personnel to capitalise on our strong and expanding on-road project pipeline. Production revenues from these programs are expected to start in 2017-18."

Boyle added: "We remain very bullish about our prospects this year. While we expect challenging conditions in the industrial markets in the near-term, we expect to see further improvement in our on-road business as a result of our strong project pipeline."

Sevcon also said sales for the period from October 2016 to December 2016 were supported with a $5.2m (£4.2m) boost from the acquisition of the Italian battery charging company Bassi.

Sevcon employs more than 80 engineers in its Team Valley HQ and is recruiting a further 20 engineers in the Thames Valley.