Hardide Plc (LON:HDD) CEO Philip Kirkham talks to DirectorsTalk about the raising of £2.54m. Philip explains what the funds will be used for, a potential loan with Martinsville-Henry County Economic Development Corporation, a framework supply agreement signed with a major North American operator in the oil and gas sector, recruiting and current trading.
Hardide Plc expects to report preliminary year-end results in line with current market expectations, having benefited from a nascent recovery in the oil and gas market and from new business, both in oil and gas and precision engineering. As announced in the Company’s interim results, the positive trends in underlying market conditions seen in the first half of the financial year have continued through into the full year.
Following approval by Airbus and Nadcap accreditation, the prospects for additional aerospace business are encouraging. Well under way are the development and trialling of safety‑critical parts for aerospace customers and this augurs well for future sales.
Since the year-end, a three-year agreement has been signed with a North American based, major international operator in the oil and gas sector which sets out a framework for future orders for the coating of downhole components. Technical work with this client with a view to beginning production is progressing well. A further agreement is being finalised with a manufacturer of land-based drilling and production tools.
The first orders under these agreements are expected to be received in early 2018 and combined, initial sales are expected to be worth up to £1 million per annum with good potential for this to grow. These two agreements underpin the management’s expectations for revenue growth in the financial years to September 2019 and 2020.
The US coatings facility in Virginia is performing well. Management expects that the facility would, based on expected orders and its existing reactors, likely require additional capacity in the second half of the 2018 financial year.
The Company expects to release its preliminary results for the year ended 30 September 2017 on 11 December 2017.