An electronics firm lost nearly £6 million last year after it over-stretched itself with contracts to supply energy-efficient LED lighting to Morrisons.

APC Technology, which traditionally makes components for electricals, watched its profits eroded as its Minimise Energy division committed huge resources to the installation programme at the supermarket, which had been the business’ major customer.

The company also suffered from the cost of ferrying LED lighting from its manufacturers in the Far East and the subsequent price of stockholding and warehousing it.

APC Technology replaced its long-standing chief executive Mark Robinson in August last year, promoting chief operating officer Richard Hodgson to the role.

Earlier this week, Mr Hodgson revealed new contracts for Minimise Energy worth £1.5 million, which he said would bring an end to a “difficult year”.

APC Technology made a total operating loss of £4.6 million in the 12 months to August 2015, a sharp turnaround from a profit of £427,000 a year earlier.

However, revenues across the group increased by 51% to £31.1 million, with £21 million of recurring or repeat business across 1,500 customers.

The business made a pre-tax loss of £5.8 million, after a profit of £382,000 a year earlier, but said cost saving initiatives have since been introduced to deliver £1 million of annual cost savings.

The firm said its traditional electronic component distribution business enjoyed a steady, profitable year.

Meanwhile its water management business, established in September 2014 with the acquisition of water treatment firm Green Compliance, has been successfully integrated into the group.

Chairman Leonard Seelig said: “Our focus post period end has been to execute the operational review, improving profitability and enhancing growth.

“Under the guidance of our new chief executive Richard Hodgson, the group is now focused on realising the potential of its profitable businesses, both through winning new customers and capitalising on cross-selling opportunities wherever possible.

“It was a challenging year for APC but with the business now stabilised and a clear new strategy in place, there is cause for a renewed sense of optimism.”