UNDER pressure microchip manufacturer Filtronic has promised to "tough it out" at its Newton Aycliffe facility, despite costs of £1m a month.

Yesterday, the Northern Echo revealed the full extent of the losses at the West Yorkshire-based mobile phone components manufacturer, which renovated the former Fujitsu site when the Japanese giant closed, at a cost of £40m.

The company has no plans to lay off any of the 100 staff working at the site, and bosses still have plans to create the 500 jobs originally envisaged for the site.

David Rhodes, chairman of Filtronic, said the company had "miscalculated" the time it would take to get the Aycliffe plant profitable.

The company had expected to start fulfilling orders from this month, but it now expects volume production to begin in September.

It has yet to secure any large scale orders for its gallium arsenide, seen as an alternative to silicon chips.

The news that Filtronic will keep its Aycliffe operation open, has been welcomed by local authority Sedgefield Borough Council.

Councillor Bill Waters, cabinet member for regeneration, said: "The council has been in touch with Filtronic who have advised us they are still advertising and recruiting for positions at Newton Aycliffe.

"We were also informed that the company is continuing to purchase new equipment and expand their business at Newton Aycliffe, which is obviously good news for the area."

He added: "Since Filtronic arrived in Newton Aycliffe, Sedgefield Borough Council has always given our support to the company both in its investment in the area and the creation of jobs for local people, and we will continue to give that support."

Filtronic is currently looking for a partner for the business, a move welcomed by City analysts.