Shares in Velocity Composites Ltd (AIM:VEL) plunged 25% to 16.5p after the aerospace materials supplier warned that revenue for the year to October fell short of expectations and forecast a slower 2026.
The company, which provides composite material kits for aircraft manufacturers, reported unaudited full-year revenue of £20.7 million, down from £23 million a year earlier, as lower Airbus A350 production rates and delays with a key US customer hit performance.
The business also said it expects sales next year to be below current market forecasts due to ongoing disruptions in both the US and Europe.
Despite the softer top line, Velocity said adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) more than doubled from last year’s £0.4 million, helped by efficiency gains and reduced overheads.
The group ended the year with £0.4 million in cash and no net debt, supported by an unused £3 million invoice discounting facility with NatWest.
Chief executive Jon Bridges said the company remained positive about long-term prospects, citing rising global air travel and new aerospace opportunities in the UK, EU and US.
He added that Velocity would stay focused on cash generation and operational improvements ahead of an eventual ramp-up in production rates.