Williams records a loss of 48 million euros in 2014
F1 teams must always contend with a time lag between their success on the track and their finances being in the black. Thus, Williams, third in the 2014 championship, recorded a loss of 48 million euros last year.
Last September, Williams announced in their mid-year report that they had lost 20 million pounds, equivalent to 28 million euros. The year’s results are therefore a logical continuation but still require some explanations.
Indeed, for accounting reasons, the team had to record in their 2013 accounts the revenues that PDVSA paid them under the agreement they had for 2014, even though the Venezuelan has since moved to Lotus. Similarly, the millions that Bernie Ecclestone will pay them for their third place in the Constructors’ Championship will only be paid and therefore recorded in the 2015 financial year. This explains why the group’s turnover dropped in one year from 180 million euros to only 125 million, despite the arrival of a new title sponsor, Martini.
Conversely, its costs have increased with the arrival of the new turbo V6s, which are significantly more expensive than the old V8s. The team therefore had to contend with a decrease in its revenues and an increase in its costs, which explains the shift from a profit of 17 million euros in 2013 to a loss of 48 million euros a year later.
This is what Mike O’Driscoll, the CEO of the group, comments: « The group’s financial performance in 2014 reflects our poor track results over the past three seasons, which resulted in a decrease in our commercial rights and sponsorship revenue. Last year was also negatively impacted by the costs of relocating our Advanced Engineering activities. Our significant progress during the 2014 championship will translate into higher commercial and sponsorship revenues in 2015, which will be supported by the improvement in performance of our Advanced Engineering division. »
During the off-season, the team’s commercial activity was intense as it managed to attract two sponsors from Lotus: Avanade and Unilever (under the Rexona brand). It is therefore highly likely that revenue and profits will increase in 2015. This will help boost its stock price, currently at 15.20 euros, whereas the initial offering price in 2011 was above 24 euros per share.
With the participation of www.Racingbusiness.fr
