Member Article

Increased customer demand fuels growth for Gateshead’s Sevcon

The global switch to low carbon transport has seen North East business Sevcon report strong sales, landing high-value contracts with some of the world’s largest companies.

Profits for the designer and manufacturer of motor controllers for electric and hybrid vehicles rose to £627k in the six months from September 2014 to March 2015, up from £595k in the first six months of the previous financial year.

Revenues for the Gateshead company increased to £13.3m for the same period, up from £11.96m in the corresponding six months the year before.

Revenues for the second quarter (January to March 2015) increased to £6.79m, from £6.02m with profits of £442k, compared to£129k in the second quarter last financial year.

Last month Sevcon received a grant of £400,000k from the Regional Growth Fund for the development of new range of motor controllers which would help create 20 new North East jobs.

President and CEO Matt Boyle said: “We see the operating results that Sevcon delivered in the second quarter as an indicator of the performance we can expect for the foreseeable future.

“We believe that our traditional off-road industrial markets will continue to be a proxy for global economic trends, and we have initiatives underway to accelerate our growth in those sectors against that backdrop.

“In the on-road sector, our higher investment in our engineering and technical innovation has enabled us to forge strong partnerships with some of the largest companies in the world. We have the opportunity to write the next chapter of Sevcon’s growth by capitalizing on the opportunities we see emerging in electrification.

“We believe that our core technology platforms can be applied and sold across multiple, higher-growth markets as the world transitions to electrification. Sevcon’s flexible, adaptable solutions strategy creates a wide variety of customer-specific products that can lower our production costs through larger volumes, protect our present margins, and create opportunities for organic growth.”

Mr Boyle added: “Nearly all of our growth in the second quarter was driven by increased customer demand for the flexible and easily adaptable power train solutions we have been developing for an expanding range of on-road applications.

“Although the majority of our incremental Q2 on-road sales were for electric and hybrid vehicle applications, we see growing demand for our next generation of products in other electrification applications such as hybridisation for improved performance and efficiency.”