In 2017-2022 Hidria will supply glow plugs for diesel engines produced by PSA Peugeot Citroen, the second biggest maker of diesel engines in the world.

"The contract is important for its direct effect on sales, but even more importantly, we have finally positioned ourselves as a leading global supplier with the most innovative solutions in this segment," chairman Iztok Seljak told the press in Ljubljana on Thursday.

"Based on this contract we expect new and bigger deals in the coming weeks and months," he said, indicating that a EUR 20m deal will be signed with BMW shortly.

Hidria has recently signed a master restructuring agreement with banks, which Seljak said would allow it to increase sales from the estimated EUR 250m last year to about EUR 350m in the medium term.

The Idrija-based company posted a pre-tax profit (EBITDA) of EUR 22.5m last year, up from EUR 18.5m a year earlier. The target for this year is EUR 25m.