By Tavia Evans

Zoltek Cos. of Bridgeton reported strong sales and increased demand for its carbon fiber technology in 2005, but costs to restart production lines in its Texas facility continued to drag down profits.

Net sales for the carbon-fiber maker increased to $60.2 million, up from $39.8 million the previous year.

But the company's operating losses climbed to $8.1 million, up from $5.7 million in 2004.

Shares of Zoltek closed at $9.51 Tuesday on the Nasdaq Stock Market, up 29 cents.

Zsolt Rumy, chief executive, said training personnel has slowed production at the Texas facility, where the continuous carbon fiber is produced. The company had planned to ramp up its five production lines and increase capacity at the facility, which has been idle for four years.

"We have to reassess how much potential expansion we can do and whether we need to make that kind of investment in Abilene," Rumy said in a phone interview. "Our market is in Europe right now."

Zoltek said there's now a booming demand for its carbon-fiber technology, after the company struggled in recent years to find commercial markets for the product. Carbon fiber is a high-strength synthetic product that can be used to make lightweight, heat- and corrosion-resistant composite material.

In a conference call Tuesday, the company said 50 percent of its carbon-fiber product will go into the wind energy business in the next two years. Zoltek also found demand for the products as reinforcement in pre-cast concrete, aircraft brakes, compressed natural gas, automotive frames and a new application for deep sea drilling.

Zoltek's stock has dropped to single digits in recent months, after hovering in the low teens for most of the year. Shares of Zoltek traded for $19.63 on Jan. 19, 2005, a historic high.

The company announced in October an influx of $50 million in financing, divided into four closings. The bulk of those funds will be used for expansion at a plant in Hungary, where the company plans to have eight production lines in 2006.

Despite setbacks in 2005, Zoltek said it's on track to increase its capacity to 19 million pounds this year from 9 million pounds. And it expects to double capacity in 2007.

Rumy said in coming years, the carbon-fiber maker may also look to markets in the Far East for expansion.

tevans@post-dispatch.com 314-340-8159