A TECHNOLOGY firm has warned there are tough years ahead as it beds in changes to overcome damaging losses.

Filtronic, based at NetPark, in Sedgefield, County Durham, has been badly hampered by poor demand and product delays.

The setbacks have forced the company into a £2m turnaround plan, which has seen it pare back its workforce in a bid to alleviate the pressure.

It said the changes, which also include reducing overheads and strengthening sales and marketing work, are taking effect, but warned they are coming against disappointing results for the year to May 31.

According to a statement, sales revenues fell from £32.9m to £17.5m in the period, with pre-tax losses lifting from £3.7m to £11m.

Rob Smith, chief executive, said: “We are embarking on a programme of change to improve our performance.

“While it will be a tough few years of transition, it is necessary to help the firm become the successful, profitable and growing company it aspires to be.”

Filtronic’s woes were heightened after it was stung by the end of a large contract to supply TV anti-interference filters in its wireless business, which contributed to sales dropping nearly £13m to £10.3m in the division.

Its brandband arm, which is based in Sedgefield, was also hit, with sales down £2m to £7.2m.

However, Mr Smith said the business is making progress, with its Sedgefield division leading the fight.

The base employs about 65 staff and has received initial production orders from a major customer for its e-band transceivers, which help increase the amount of data able to be pushed around phone networks so phone users can access videos.

The company’s wireless division is also overcoming its issues, with new antennas now being trialled by major operators and orders expected to follow.

Mr Smith added: “We have invested in product development and our focus now is to ensure we commercialise these developments.

“The mobile telecoms market continues to show strong growth and our e-band transceivers and antennas will be leading products in the next few years.

“We envisage further development of antennas and e-band products, so that we position ourselves to be an increasingly key supplier in our chosen market space.”

The Northern Echo last year exclusively revealed Filtronic would remain in the North-East.

It had been based in the former RFMD microelectronics plant in Newton Aycliffe, County Durham, but the US firm moved out of the region raising fears over Filtronic’s presence.