Cosworth chief executive Hal Reisiger has told Insider of his confidence in the turnaround strategy underway at the company.
The Northampton-headquartered high-performance engine maker has made another loss in 2013 according to the latest accounts but Reisiger said he expected a "tremendous" boost in financial results in the coming years as the new strategy, alongside substantial investment in products and facilities, paid off.
The group had grown strongly in the past with sales accelerating from about £33m in 2009 to almost £55m in 2011. However, unexpected programme cancellations and deferments in the automotive and defence markets hit revenue. Changing regulation in Formula One also made it "prohibitively expensive" to be an independent engine supplier for the sport.
An announcement by Cosworth's shareholders toward the end of 2012 that they were seeking an exit further impacted sales as customers awaited an outcome.
These issues have leaked into the latest results – for the year to 31 December 2013 – which have just been published.
Sales in the period fell another 18 per cent to £31.8m – down from a restated £38.7m, which is lower than the originally reported £41.5m.
The reduction led to an operating loss of £6.5m and a full-year loss of £8.6m, compared with losses of £8m (restated) and £8.3m respectively in 2012.
However, chief executive Hal Reisiger told Insider the turnaround was going well and beginning to bear fruit.
"We took a look at the business and decided to refine and refocus the strategy on a smaller number of core markets. That became motorsport, where we have legacy and history, and extended to automotive OEM production and to expanding our presence in the aftermarket."
A big pillar of the rethink is a major investment at the Northampton headquarters in St James Mill, where it has been based for 50 years. Cosworth is ploughing £15m into a new centre of excellence at the site.
The move is already paying off, with contracts to supply a performance electronic package for the new Corvette one of the highlight wins. It was expected to be a "revenue perfect cashflow generator" for a long period of time, Reisiger said. He added the business was also speaking to Chevrolet about more work on more models over the next few years.
Speaking about the new 38,000 sq ft factory, set to be operational later this year, he said: "Our investment enables us to manufacture the increasingly complex engine components more cost effectively and in addition we have some unique capabilities at the new facility."
Venture capitalist owners Kevin Kalkhoven and Gerald Forsythe have once again committed to Cosworth for the foreseeable future and injected fresh funds into the business to fuel the new strategy.
"We are in an excellent and enviable position where we have shareholders who are enthusiastic about the business, have a passion for it, believe in the strategy and are willing to continue to invest," Reisiger said.
"We're building a solid foundation, we have the organisational structure and people in place to do it, and the strategy and the execution of the plan are starting to produce the desired results. I think you'll see a tremendous difference in 2015/16 in our financial performance."