A TECHNOLOGY firm expects to surmount delays to a near £5m contract by building on a recruitment drive with fresh contracts, its boss yesterday told The Northern Echo.

Rob Smith says Filtronic is “developing and progressing nicely” after strengthening its North-East workforce to cater for rising demand.

The business has seen a lucrative deal to improve defence sector data connections held up by supply issues, while half-year revenue and profit have also fallen.

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However, Mr Smith said the business, based on NetPark, in Sedgefield, County Durham, is well placed to secure new contracts, adding it has taken on eight staff at Sedgefield as it manoeuvres into position to benefit from clamour for faster, 5G mobile connections.

The company’s contract to supply high-frequency apparatus for its defence customer was revealed last year and is expected to deliver revenues of £4.8m over a 36-month period.

However, issues with a customer-specified component have pushed back its production schedule, with agreed volumes now expected to be achieved in the second half of its financial year.

But Mr Smith, chief executive, said the delay will have no lasting impact on Filtronic’s progress, saying the work is expected to deliver spin-off supply agreements that will take its existing three-year timetable to five years.

“We have had a few hiccups in terms of setting up the contract, within which we’ve not had a choice.

“But we are working on the issue with the supplier and the customer.

“The potential extra work will go on the end of the current working.

“It could mean that a three-year contract extends for another two years.”

According to the company’s latest financial results, released yesterday, operating profit in the six months to November 30 halved to £900,000 compared to a year ago.

Revenue was also down from £21.6m to £12.8m.

However, Mr Smith said the numbers were reflective of a strong comparative period 12 months earlier and the completion of orders for its antennas, adding the fact the firm has remained in profit, when it previously did not, was significant.

He also said the business, which now employs 70 staff at its Sedgefield broadband operation, is readying itself for greater market penetration as demand for 5G networks increases.

The change is expected to provide technology users with more data capacity than existing 4G platforms, and Mr Smith said Filtronic’s high-frequency apparatus leaves it well placed to take advantage.

He added: “We are making a profit.

"In the past, if the company had a dip we went into losses, but we have had a dip and are still profitable and still generating cash.

“We have made a lot of progress, and we are developing and progressing nicely.

“To that end, we are aligning our two development teams together, which have covered our wireless and broadband operations, so that they work more closely.

“It’s all about preparing for 5G.

“We have won some key contracts, which are all about the upcoming 5G standards.

“They are the technology that will be used in 5G and as companies are looking to ramp up capabilities, we are picking up business.

“We have got to position ourselves and sell our capabilities to customers.”

The Echo last year revealed Filtronic was working alongside a US customer to provide fast and reliable broadband connections without the disruption and cost of laying swathes of cabling underneath roads and footpaths.