8th Feb 07 ARMSHARE update :Link Back to Page 6 Here


Information Archive Folder : http://www.esnips.com/web/SurfaceTransformsInfo/


Main Web Site : http://www.surface-transforms.com/

March 2008 Presentation : Presentation Link


Commerical Overview

Surface Transform plcs core activity is exploiting proprietary technologies to create innovative, lightweight, high energy dissipating braking system materials, which can be commercialised for high-performance applications.

Surface Transforms plc has worked on technology programmes in collaboration with major companies such as AlliedSignal Inc, BAE Systems/Roxel, Dunlop Aerospace and Faiveley

Today, Surface Transforms is commercialising its products for an increasing range of high-performance applications. These include automotive, motorsport and aircraft brakes, for which the company has developed Ceramic brakes with improved friction properties, enhanced lifetime and lower production costs. Other growth areas include aerospace components (principally rocket motors) and anti-ballistic armour.

Key milestones have included:

-A new aircraft brakes development contract (Jan 2004) with a leading US based aircraft brakes maker
-A licensing contract (September 2003) with Dunlop Aerospace to develop and supply CFRC brakes;
-A contract with the UK Ministry of Defence to supply innovative materials that will increase protection against high-power rifle and cannon fire;
-A contract with the United States Airforce Research Laboratory for the supply of prototype CFRC materials for military applications.
-First commercial sales of carbon-ceramic brake discs for installation on the KOENIGSEGG Swedish supercar
-First commercial sales of Carbon Ceramic road car discs to StopTech the California based brake system upgrade specialists.
-First commercial sales of Carbon Ceramic road car discs to MOVIT one of the leading brake after-market upgrade kit suppliers based in Germany.


Not expecting anything over night here but to me it is now at the stage of becoming a good play with potential rewards in 2010 onwards on success.

Nice to see it return blue now year end is gone ;)

Don't you love the MM's, slam the price down for year end sells getting as much as you can on the cheap, and then lift it back up again, blue again today as was yesterday :)

Someone purchased 50K at 22p this morning (delayed reporting).

A director buy ?

Copied a few posts over from another BB, as some good points raised and discussed I think.


Gelp - 7 Jan'06 - 00:42 - 103 of 106
The latest porche boxster price list/book has the ceramic brakes listed as optional extra at 4550. I assume they are from ST - any others?
It's a pretty expensive optional extra - though the way my wife drives could be worth it!
Its good to see exposure of the product.
I do not know if listed on the other (faster) Porche price lists.
Dilema:What is better investment new Boxster (and keep the 5 year old, 20k miles one) or more shares?


PapalPower - 7 Jan'06 - 01:08 - 104 of 106
Gelp, Porsche have their own system, called PCCB and so do Ferrari and others. The trouble is they have had a bad reputation, the OEM systems have been very very expensive, not lasting a fraction of the 300,000M they are supposed too and other things too.

SCE is providing a system which is less than half the price (much less than half in most circumstances and sometimes way even below that), for improved performance and longer life. This is why I think the company focus is presently on aftermarket sales, while they offer a much cheaper and better upgrade for users who did not opt for Cermaic brakes from the off, and as an alternate cheaper replacement for those not happy with the OEM system, and want the benefits but not the high cost of maintaining the OEM system. This is the immediate target for sales, whilst they pursue OEM's who might not have the money to waste like Porsche and Ferrari on making their own system, and also pursue these larger OEM's who might have plans or already be producing a ceramic braking system, but who cannot produce the goods OR who can produce the goods but at horrific expensive prices.

This is where it snowballs for SCE, or should, as once some people start offering the Ceramic brake option at lets say 2000, its a bad sales pitch for others offering the system at 5000 or 10,000, and either they have to reduce their price, or also adopt the SCE system.

SCE have been working as a major goal of reducing the price to manufacture and improving the performance, which is what they have now, a low priced product that we are led to belive now outperforms the highly expensive systems of Porsche and Ferrari. They have also patented those processes, as was reported recently, so they are in lead position now with the ability to produce these at decent cost effective pricing, patented.

PapalPower - 7 Jan'06 - 01:50 - 105 of 106
The main benefits with the ceramic system I think are ;

1/ Weight reduction (benefiting performance and fuel efficiency). Quite dramatic weight reduction is possible using cermaic brakes over standard steel ones. (Put a bag of cement in the back of your car, see how it runs with it, and when its removed, the effects are larger than you think)

2/ Long life, longer than the life of the car.

3/ Improved performance under certain operating conditions.

4/ Large reduction in dust generation.


Now although initially the targets are high performance cars, the benefits would also be great on your smaller models (less weight, improved fuel efficiency, less maintenance), but that needs someone to be able to produce the technology at cheaper and cheaper prices.

Now did SCE recently get a grant to investigate further reductions in cost of manufacture of cermaic brake disks ? Do you see a plan in action ?

To me finally, I am seeing light at the end of the tunnel, a plan being executed, and once we get some small OEM's signed up, like TVR, then things look very exciting.


(Oh, and all these benefits in manufacturing costs, should be rolled on to aircraft braking systems. Apart from the big commercial ones, there was interest in military applications, but the trouble there is, the military budgets are always being cut, but now if someone can supply the technology cheaper, these options start to open up again)

Advanced ceramics is not just about performance, its about costs as well, if you can have excellent performance and low cost, then you win. As can be seen from Porsche and Ferrari OEM systems, the performance is (now after a lot of work) potentially there, but these OEM's cannot provide that performance at decent low cost. Half or quarter the price of the ceramic brake option, and watch its request for use go up and up, it could even become standard due to performance and weight benefits.

Gelp - 9 Jan'06 - 01:47 - 106 of 106
Ty 4 very very helpful post. I did see an announcement of the 200k announcement for a grant to develop low cost methods of manufacture - whether received yet I do not know.
The 4550 cost plus Vat makes the present option by far the most expensive optional extra - priced NOT to sell perhaps - so sure the possibility of better quality at lower (sensible) cost is great.
I met Kevin d'Silva a few years ago when he was with Ferraris (FER)- not the cars - during the growth years and I was impressed - one of the reasons I bought a few shares (SCE) in the first place -
Thanks again for the posts.

Should be the last sells of any left over RHPS holders today who are not going to hold any longer. This is good, as it now sets us up nicely for when news comes, hopefully on the TVR deal and hopefully in Q1. Will be adding yet again in the coming weeks.

http://www.systemst.com/downloads/news/Autosport-Show06.pdf

SystemST at Autosport International Exhibition

12th & 13th January 2006


Surface Transforms Plc exhibits its SystemST carbon-ceramic brakes at Autosport - The Racing Car Show, NEC Birmingham, 12th & 13th January 2006
Autosport Engineering is the fastest-growing international motorsport technology show in the world and provides a forum for those involved in the industry to meet suppliers and find out about the best new products and services on offer. Last years show in January saw over 25,000 trade visitors from around the world visiting over 380 stands.

The exhibition covers every part of the motorsport industry ranging from braking systems and electronics to metal-testing and lubricants. Surface Transforms plc (ST) is taking this opportunity to promote and exhibit its SystemST Carbon-Ceramic brakes for road and track use. ST will be located in Hall 20, stand E630 at the show.

SystemST carbon-ceramic brake discs utilise ST proprietary technology, producing a 70% lighter disc, increased friction levels, reduced brake fade, extended lifetime and higher integrity compared to steel.

Installing SystemST carbon-ceramic brake discs dramatically improves a cars
performance through improved handling, increased stopping power, reduced stopping distances, no corrosion, no disc wear and nominal fade.

SystemST carbon-ceramic brake discs are suitable for both road and track applications and Surface Transforms Plc offers ceramic discs and upgrade kits for a variety of high performance cars including several Ferrari, Porsche and BMW models. If you are interested in getting SystemST lightweight ceramic brakes on your car, and experiencing the benefits of this cutting edge technology, contact Antoni Sznerch at as@surfacetransforms.com

Interesting write up on the Ferrari conversion;

http://www.systemst.com/downloads/information-packs/F48-Information-Pack.pdf

And a good presentation on the benefits of carbon ceramic brake systems. Takes a some time to load before the show begins.

http://www.systemst.com/flash/Steel-vs-Ceramic.swf

Nice to see a little movement today, so many things going on in the background ;)

A photo of the new Aston Martin Rapide, no idea on the brakes though.





But they do look ceramic do they not, now the question is who else are Surface Transforms working with ? We know about TVR.........but there are a number of other OEM's also working with Surface Transforms, just no details released about who they are.

Something must be up, either a T trade buy to come through, or some news will be released in the coming weeks.

I now have some informal and indicative pricing information on Ceramic Braking Systems (prices for reference only) , which shows the present advantages of SystemST over OEM :


To convert an existing Porsche with standard braking to ceramic braking ;

Official Porsche Kit (EXCluding fitting) 11,415 (inc VAT / inc calipers etc.)

System ST Kit 4 disc (INCluding fitting) 8,132 (inc VAT / inc calipers etc.)

Therefore if you add the labour prices (and they are not cheap per hour) to fit the offical Porsche Kit, you could well be looking at the Porsche kit being at least 50% more expensive, maybe morem than the System ST Kit.


Taking this down to a base level cost for the ceramic disc only, then ;

Replacement Porsche Disc approx 3,000 (inc VAT)

System ST disc approx 1,469 (inc VAT)

Very well played by Surface Transforms, we know from the trading statement what is the state of play, we know its going to be around a 650K loss, we have been through that already, so the pending results hold no negative surprises, which is good :)


Surface Transforms plc
('Surface Transforms' or 'the Company')
Notice of results

Surface Transforms plc, manufacturer of high technology carbon ceramic
materials for braking systems, will announce its interim results for the six
months ended 30 November 2005 on Tuesday, 28 February 2006. A trading statement on the first six months of the 2005/6 financial year was released on 14
December 2005 and can be viewed on the Company's website

For those wanting to buy into the story and preparted to hold for a couple of years, a good buying opportunity should be coming, and that is results day, 28th Feb. We all know in advance what they contain in terms of losses (650K approx) so if the MM's drop the price on results, will be a decent buying op I think.
SCE remains a buy and hold for 2008/9 for me.

http://www.companyannouncements.net/cgi-bin/articles/20060228070000P6B76.html

The results reads fine, all good going forward, and the plans remain in place with progress going towards the goals.

With some smaller OEM's due to sign up in 2006, time to buy some more now in April for me.

I think they are slowely getting there, and this is what I expected, 07/08/09 will be, as I said in 05, the big years, each one bigger than the last is my opinion.

Latest update at www.armshare.com


"The interim results to November 2005 showed sales of 68,000 (2004: 208,000) and pre-tax loss of 479,000 (2004: 239,000) - the explanation for these results was given in the December 2005 announcement (see above). The company reported that it maintains brake development programmes with three global suppliers of aircraft brakes, two European and one US - there has been extensive development work with the latter, with Phase 1 (measurement of wear and friction) nearing completion and the expectation that development work will continue for the next year; regarding automotive, a Swedish supercar fitted with SystemST is on display at the 2006 Geneva Motor Show - sales via METEK into the German aftermarket have been disappointing, resulting in the arrangement being terminated and a replacement being sought - in the short to medium term the board expects the first commercial success to come from one of the smaller high performance car OEMs; cash at November 2005 was 2.1 million (representing c15p per share).
Research Standing
The market invariably canes a company's share price where there is a setback such as occurred in Autumn 2004 on the aircraft brake project with Dunlop. This provides opportunities for the more dispassionate and longer term investor. ArmShare is an advocate of constructing portfolios comprising at least 80% invested in established businesses combining growth and value and up to 20% in a portfolio of earlier stage higher risk businesses considered to have the potential to develop into the former - Surface Transforms is an obvious candidate for the '20%' category of such a portfolio.

Whilst the financial results to November 2005 scarcely hit the radar screen, they mask the fact that the company has made very significant progress in strengthening its position for negotiating with channel partners, particularly in automotive. Until it started to fully understand and be able to control the entire process for delivering merchantable brakes, it was very difficult to hold serious discussions with OEMs because it could not deliver a turnkey solution - automotive OEMs are different from aicraft brake OEMs because the latter already use the processes which accompany ST's core process - this position will be enhanced by the significant cost reduction which ST expects to derive from the new plant due to be completed in the course of 2006.

With cash at bank at November 2005 equivalent to 15p per share, a share price of 17p at 28th February, a team which has strengthened considerably over the last two years and much greater knowledge/control re the delivery of merchantable solutions, ST is now a very attractively valued concept stock."

Papal Power, you may be right about a buying op - with the cash supporting the sp (does it still?) - I hold from higher prices.
But the problem I have with this business is that their selling-prices are so very high. Compared with the Porche price, it's a bargain, but unless your car is fairly new this level of investment is likely to raise the value of the car.
Furthermore, I suspect it will increase your insurance "risk" and premium and dissapating extra heat will lower your MPG. For most drivers it adds little benefit at huge cost.
/
In practical terms it wold be better applied to 4x4's where weight stores much energy to be dissapated (esp at Motorway speeds) and therefore there could be a safety benefit......so that 4x4's could brake in about the same distance as saloons.
I'm sure the same goes for Lorries......
/
So SCE needs to address cost, hold-back on racing, ...look at the wider market. Since they are making both disc and caliper, it should be possible to have a smaller range of discs to suit more vehicles....since any up-grade will be a safety bonus.
/
I don't believe safety issues really affect Porches, since at normal UK-speeds their brakes are superb. I accept the New Plant may address these issues, but there needs to be a sea-change by management, looking at less-glam sectors and I don't get that impression from what is becomming a very silent company.
Regards

Koenigsegg Automotive of Sweden are showing their new model the CCX, which is fitted with SystemST brakes at the Geneva Motor Show March 2nd to 12th 2006

http://www.koenigsegg.com/thecars/ccx.asp?ccx=2

Picking up on the comments, it fits in with everything, especially the initial production facilities, 2000 brakes is break even, 3000 would be a profit, and of course any large OEM deal would be them making the brakes, not SCE making them, with SCE getting royalties for the technology.



Mr D'Silva said: "Despite the lower sales and financial performance in the period under review, the board believes it has made material progress in both reducing the business risk in the company and in improving the capability of successfully implementing its business strategy.
"This is already reflected in the quality of discussions we are having with potentially important commercial partners."
In November, the company announced it had received a 200,000 grant from the Northwest Development Agency (NWDA) towards a new production facility.
The new plant will have the capacity to produce up to 3,000 discs a year, significantly reducing costs.
In the UK, the firm's SystemST brake product has initially targeted owners of Ferraris and Porsches.
It has also received orders from Weber Sportcars, in Switzerland, which is building a new 300,000-plus supercar for launch later in the year.

http://iccheshireonline.icnetwork.co.uk

Surface Transforms plc

('Surface Transforms' or 'the Company')

Supply Agreement with Koenigsegg Automotive AB

Surface Transforms plc, the manufacturer of carbon fibre reinforced ceramic
(CFRC) materials, is pleased to announce the signing of an agreement to supply
high performance, carbon ceramic automotive brake discs and components to
Koenigsegg Automotive AB ('Koenigsegg') of Sweden.

Based in Angelholm, Koenigsegg is an established European manufacturer with a
ten year history of producing high performance supercars. Koenigsegg has a
number of models in its product range with the most recent being the CCX, which
it launched at the 2006 Geneva Motor Show earlier this month. The list prices
of the cars are high, with the CCX typically selling for over 450,000 each -
the unique Koenigsegg engine produces over 800bhp with a 0-100 kph acceleration
of 3.2 seconds. The CCX can be fitted with SystemST ceramic brakes as an option
but Koenigsegg are of the view that most of its buyers will choose the new
ceramic brake system.

This supply agreement is for an initial term of 12 months with a 3 month notice
clause, and it has an annual value of up to 131,000. Ceramic brakes are also
being offered as an upgrade option to all pre-CCX model owners of Koenigsegg's
cars.

The Company's strategy is to be a pre eminent supplier of carbon ceramic disc
brakes to the leading manufacturers of high performance cars. SystemST has been
under development for over five years and the technical results show that these
ceramic carbon brakes have superior braking, wear and surface corrosion
characteristics when compared to `old' cast iron technology. SystemST typically
reduces the unsprung weight of car by approximately 20 kgs when compared to its
iron equivalent. This can lead to an improvement in fuel economy and a life
span five times longer than iron disc brakes.

Technical data and car case histories are available and user enquiries managed
on www.systemST.co.uk.

Dr.Kevin Johnson, Managing Director of Surface Transforms plc, said:

'This agreement represents a very welcome certification of SystemST carbon
ceramic brakes from a formidable designer and manufacturer of some of Europe's
most exciting supercars.'

Christian Koenigsegg, founder and Managing Director of Koenigsegg AB, said:

`We have worked closely with the Surface Transforms` teams to produce an
exceptional ceramic brake system which further enhances our car's performance.'

For enquiries, please contact:

Surface Transforms plc 0151 3737130

Dr. Kevin Johnson

Mr. Antoni Sznerch

John East & Partners Ltd (Nomad) 0207 628 2200

Simon Clements, Johnny Townsend

Teather & Greenwood (Broker) 0207 426 9000

Mark Dickenson, Sindre Ottesen

Details of the Company's business and financial performance and its share price
can be found on www.armshare.com, which is accessed from the Armshare icon on
www.surface-transforms.com. A webcast of the 2005 results is also available on
www.surface-transforms.com/Investor and Media relations.