Velocity Composites shares jumped 16% as an update indicated trading has been in line with expectations in the six months to end 30 April 2023 with sales picking up as air travel recovers.
Revenue rose by 15% to £7mln, with the UK stronger than initially expected and accelerating towards the end of the period.
Velocity added that its new advanced manufacturing facility in Tallassee, Alabama, is now complete with AS9100 quality approvals granted and the first production kits manufactured as a part of a five-year agreement with GKN Aerospace.
This contract is expected to be worth more than US$100mln in revenue over its term.
Developing the new facility has incurred start-up costs of around £0.4mln, which will mean interim underlying losses rising to £0.9mln, though Velocity expects to recover these as the new facility ramps up during 2023.
Price increases have been agreed with key customers to offset inflation pressures, added Velocys, the benefit of which will also come through in the second half of the year.
Net debt at 30 April was £1.8mln, with GKN Aerospace providing finance for the working capital initially needed on its contract.
Velocity added it will use its new Alabama facility, which has the scope to double capacity, to target the US composite materials market though it noted there are also significant opportunities for European growth through current UK customers.
Commercial contracts already in place have a value of between £30mln to £36mln per annum at OEM planned production rates, but with defence spending rising across NATO members there is scope for this to rise, it said.
Longer-term, carbon fibre composite material usage is also expected to grow significantly in civil aircraft and other transportation types.
Andy Beaden, chairman, commented: "The recent start of manufacturing at our new facility in Alabama was a major milestone and demonstrated the significant progress we have made over the last 12 months.
“We have trebled the value of commercial business under contract compared to this time last year.
“The global aerospace industry continues to recover, and alongside our new US base, we anticipate significant revenue growth in the coming years, particularly in North America.”
Shares added 6p to 44p.