NORTH-EAST based electric vehicle parts maker Sevcon has won a major new contract - which could be worth up to $50m (£32.2m) by 2020.

It comes as the Gateshead manufacturer posted strong annual results with revenues rising 18 per cent to $37.9m (£24.2m) and the company making profits of $1m (£640,000) compared to a loss in the previous year.

Sevcon told the NASDAQ it has signed a deal with a Tier-1 automotive supplier based in South East Asia to design, manufacture and supply an advanced motor controller for a new line of hybrid electric, four-door passenger vehicles.

For the full year to September 30, 2014, revenues increased by 18 per cent to $37.9m (£24.2m) from $32.2m (£20.5m) for fiscal 2013.

The company, which makes motor controllers for Renault's two-seater Twizy quadricycle and parts for Brammo motorcycles, reported that profit was $1m (£640,000), compared with an operating loss of $948,000 (£605,000) the previous year.

Sevcon president and chief executive officer Matt Boyle said. "We concluded fiscal 2014 with our seventh quarter of increased sales and it was a successful year from a bottom-line perspective.

“Since the first quarter of fiscal 2013, we have seen consistent improvement in underlying market demand, order visibility, shipments and revenue in most of our markets, although Western Europe continues to lag.

“Customers are embracing Sevcon's modular, easily adaptable powertrain solutions that only our engineering expertise and application knowledge can provide. These highly flexible products allow us to address ever more applications, assisting us to scale up cost effectively."

Referring to the new contract Mr Boyle said: “Following last month's announcement of our Chinese joint venture's first success, signing this contract with a respected Tier-1 supplier in the Far East is another milestone for our growing on-road electric vehicle business in the Asia Pacific region.

"It is also an example of how our electrification focus is enabling us to capitalize on the global automotive industry's transition from internal combustion to hybrid electric drivetrain technology.

“One of the first variants of the new generation of products that we plan to roll out over the next several years, this controller is designed to provide the advanced motor control functionality required for hybrid electric passenger car applications, while also complying with the latest EV(electric vehicle) safety requirements."

He continued: "Looking forward, we believe that our core technology platforms can be applied and sold across multiple, higher growth markets as the world transitions to electrification.

“Tactically, we are using our technological excellence and strong presence in traditional off-road markets to enter new higher growth sectors and territories.

“Our key strategic challenge is scaling the business to achieve our potential. As system electrification becomes more widespread we anticipate growing both organically and through acquisitions. As a result, capital structure and capital allocation are key strategic priorities for Sevcon.

“We are actively executing against these priorities, as evidenced by the oversubscribed rights offering we successfully completed this past September, which will help fuel our growth. We look forward to reporting continued growth and improved profitability in fiscal 2015."