British satellite firm Filtronic sees value soar 192% since landing SpaceX deal

After it was deemed the only company in the world capable of making radar for Elon Musk’s SpaceX satellite network, British technology firm Filtronic has risen almost as fast as a rocket going into orbit.

Shares in the hitherto little-known business – tucked away in County Durham –have soared 192 per cent since it signed a major deal with the US giant in April, taking its value over £300 million.

If you had bought £1,000 of shares the day before the deal was announced, your investment would be worth £2,920 today. Its success means the radar and transmitter maker has its sights on expansion.

In a gleaming new facility in Sedgefield it will assemble thousands of pieces of equipment to connect with SpaceX’s Starlink satellites orbiting 370 miles above Earth – providing internet to previously unconnected parts of the planet.

Reports last week suggested SpaceX was drawing up plans for a float that could value it at £1.1 trillion, making it the biggest public listing ever, and one from which Filtronic would benefit. 

Filtronic’s site contains pristine ‘clean’ rooms where microchips from its mostly British sub-contractors are tested, then bonded on to circuit boards. These will be used to supply SpaceX, as well as fill recently signed orders with UK defence firms BAE Systems and QinetiQ, worth £4.5 million and £2.5 million respectively, and a European satellite broadband project involving Airbus.

Two chip processing systems have been set up, where ‘a lot of the SpaceX work’ will take place, but this will rise to five – or possibly more if demand rises.

Nat Edington, Filtronic’s chief executive, told The Mail on Sunday: ‘It’s been a very good time for the business. We’ve grown rapidly. We’ve been one of the best performing companies on the London Stock Exchange, while making significant investments.’

Edington – who has spent over three decades in the electronics industry – joined in May last year.

Just three months later, an initial £6.4 million order was signed with SpaceX, followed by the big one this April, with another £47 million deal announced in August.

Filtronic was deemed to be the only company capable of making powerful transmitters for the ground stations that communicate with the Starlink network. Musk’s venture, which has nearly 9,000 satellites in low-Earth orbit, will be supplied with Filtronic’s transmitters – which are hugely powerful despite being smaller than a cereal packet.

The transmitters operate with gallium nitride, a compound that allows them to be smaller and lighter while allowing them to broadcast faster and further using ultra-high frequency microwaves known as V-Band.

The initial deal gave SpaceX the option of taking a 10 per cent stake in Filtronic, and SpaceX’s share has since grown to 15 per cent.

While the UK firm has ‘grown quite considerably in the space market’, Edington is also keen to talk up its success in other sectors.

‘Defence is also going very well, more than doubling,’ he says. ‘We have legacy businesses in critical communications but the main area for growth is space and defence.’

With a growing workload, Edington says recruitment ‘has been a key focus in the past 12 to 18 months’. The company, based in Sedgefield’s North East Technology Park, a cluster of high-tech businesses opened by then local MP Tony Blair in 2004, is planning to grow its workforce to 200, from 130 when Edington took over.

The firm also has small bases in Cambridge, Manchester and Leeds – where it was founded in 1977 by Leeds University Professor David Rhodes – as well as in the US state of Maryland.

Edington said: ‘We’re working with Durham, Newcastle and other UK universities to bring a stream of engineers through.’

While most of the firm’s work in the space sector was for equipment on the ground, he said the Airbus contract includes devices that could be sent into orbit.

A new range of Filtronic’s amplifiers, which are designed to connect with satellites up to 22,000 miles away, is also planned to arrive ‘in the next year or so’.

Andy Tucker, engineering director, says Filtronic caught SpaceX’s eye in 2023 during a demonstration of one of its power amplifiers, which boost radio signals.

‘We set it up within the space of a week, demonstrated it to the customer, which led to pretty much all of our SpaceX work,’ he said.

So far, the SpaceX partnership has proven incredibly lucrative.

In its results for the year to May, Filtronic’s pre-tax profit quadrupled to £13.4 million and sales rose 121 per cent to £56.3 million.

Market experts say there is still time for investors to jump on the bandwagon even after the share price rise on the London Stock Exchange’s junior AIM index.

‘The group is still…