HARDIDE, the Bicester-based manufacturer of advanced surface coatings, suffered a 29 per cent drop in revenue in the second half of the 2014/15 financial year due to a downturn in its key market of oil and gas exploration.

The company was hit by dual headwinds of falling revenue and increased costs, mainly resulting from investment in a new production facility in Virginia, in the US.

Chief executive Philip Kirkham said that from June 2015: “Our significant customers – in oil and gas – stopped ordering. It was as simple as that.”

He said the downturn in oil and gas exploration, which previously generated about 70 per cent of Hardide’s total revenue, was a consequence of low oil prices.

Hardide’s second half revenue of £1.22m was £0.5m less than the same period in the previous corresponding period.

However, a record first half, in which revenue rose 36 per cent year-on-year, saw full-year revenue decline only one per cent to £3m during the year ending September 30, 2015.

The company posted a loss of £0.33m before interest, tax, depreciation and amortisation in 2014/15, compared to £0.12m in 2013-14.

Costs for the new Virginia facility were £1.03m. Finance director Peter Davenport said about three-quarters of the £1.14m in cash and cash equivalents spent during the year helped fund the Virginia plant.

Mr Kirkham said: “Strategically, having a North American facility opens up markets for us.”

He said the company aimed to diversify further into other industries such as aerospaceand advanced engineering.