Plexus Holdings Plc’s (LON:POS) said it is “working behind the scenes” to gain traction in the production market, expected during the next financial year, as it navigates through an adjustment period following a switch in strategy last year.

The profitable wellhead rental business was sold in 2018, meaning the firm has left the exploration space within the energy sector to focus on the production side, which offers a much bigger portion of the market but with longer lead times.

In the year to 30 June, statutory losses rose to £3.3mln from £372,000 in the previous 12 months, while revenues in the ongoing business rose to £3.61mln from £318,000, as the new strategy of licensing its wellhead IP gained momentum.

Losses from the ongoing businesses dipped to £2.5mln from £3.7mln.

Plexus is now focused on larger production wellhead equipment, outlet and ‘Xmas tree’ valves using its POS-GRIP Technology and HG seals.

Revenues last year came from a production wellhead for Spirit Energy, a POS-SET Connector for abandonment operations for Oceaneering A/S and £1.4mln from the sale of two POS-GRIP wellhead systems to Russian partner Gusar for a Gazprom contract.

POS-GRIP is a leak-proof technology for metal-to-metal sealing, with Plexus looking for more deals with Gazprom once its effectiveness is demonstrated in the current drilling campaign in the Arctic.

The PPC joint venture with BEL Valves also means it can bid for much larger production contracts, according to a statement, as it would demonstrate its capability to the industry.

“We are working behind the scenes to secure business that, as we indicate, is more likely to gain traction in 2021 rather than during this financial year,” finance director Graham Stevens told Proactive on the phone.

 “One of the advantages is that we are not doing it in a cold start, the industry knows the benefits of our technology on the exploration space, so hopefully we will have a bit of a standing start on the production space.”

Cash at the year-end was £5.1mln.

–Adds company’s comment–