Williams reports slump in profits as it struggles on-track
Williams Grand Prix Holdings PLC (WGPH) has reported its latest financial results for the six months to June 30 and recorded a loss of £2.7m compared to a £10.4m profit in the prior period.
WGPH encompasses the Formula 1 team, which saw revenue drop from £65.5m to £60.7m, and its Advanced Engineering department, which posted an increase in revenue of £1.6m to £21.5m. Both sides of the business posted moderate profits of £0.2m and £2.2m respectively, although that's a drop of almost £10m for the F1 operations and £1.1m for Williams Advanced Engineering compared to 2017.
The drop in profit for the F1 team compared to 2017 was "driven by a non-recurring one-off item received in the first half of 2017" – this is the payment Mercedes made to the team to secure the services of Valtteri Bottas.
This and increased expenditure on Williams Heritage and the Williams Conference Centre contributed to an overall loss of £2.7m.
"We have delivered a solid set of financial results in what has been a challenging half year for our Formula One operations, whilst continuing to demonstrate growth in our Williams Advanced Engineering Business," explained Mike O’Driscoll, group chief executive officer.
"Revenue and EBITDA in Formula One reduced in the first half of 2018, reflecting the challenging financial environment we operate in as an independent team. We are enduring a tough 2018 season on track, which has demanded additional investment to tackle performance issues, and we have been working through these while also turning significant attention to the design of next year’s car.
"There continues to be a large gap in competitive expenditure between the leading teams and the rest of the grid, and we remain hopeful that the future of the sport under Liberty Media will bring about a fairer, more level playing field for all teams.
“Williams Advanced Engineering continues to grow following a robust performance in 2017, generating revenues across a diverse range of projects and attracting new customers with its growing reputation for outstanding delivery. The reduction in profitability in the first half is all related to the timing of various projects. Its focus remains on providing energy-efficient and technically advanced performance solutions in sectors as diverse as motorsport, aerospace, defence and healthcare.
"We are also excited about the prospects of our recently announced joint venture with Unipart (Hyperbat Limited) which will produce batteries for premium future hybrid and electric vehicles in a high-tech facility based in the UK.
"Although we continue to face challenges in a very dynamic environment, we are well placed to respond. With world class facilities and a strong and talented organisation, Williams remains determined to succeed."