Profits stall at Lotus despite revenue skyrocketing
- Credit: Norwich Theatre Royal
Profits at motoring giant Lotus have stalled in the fifth year of the company's turnaround.
In its financial statements to March 31, Lotus revealed that profits had sunk by more than half, from £2m last year to £800,000 in 2017/2018.
However the reasoning behind the sums paints a brighter picture for the Norfolk business, which has seen profits diminished due to paying back government grants of £7m.
MORE: Sunny skies make for Norfolk half-term footfall frenzyRevenue has jumped 16.3% to £103m from £89.1m, a sign the business has said is a 'further major step in the turnaround of the group'.
Gross profit at the Hethel-based company has similarly climbed from 23.9% to 24.5%.
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The group wrote that this was down to: 'The introduction of new, higher margin products delivered quickly to market and continued rigorous focus on overhead cost control and reduction.'
This year also saw a turnaround in the main breadwinner at the company, with the engineering consultancy arm of the business bringing in £2.8m more than the sales of cars and parts.
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This margin could be down to the very slight decrease of cars sold in the past year, which fell by four vehicles from 1,456 to 1,452.
The report also refers to its buyout by Hong Kong company Geely International, which has the company a £35m boost.
The report reads: 'Lotus has defined a comprehensive and expansive long term plan that will see sizable investment into the Lotus business and deliver a sustainable future for Lotus.
'It has been fully approved by the board and will see significant new production introductions over the coming years.'
MORE: Down-beet: Food giant sees hit in sugar revenuesThis could allude to production at Geely's new factory in China, which is approved to build all-electric battery cars and electric hybrids.
Lotus has already begun repositioning itself on the global stage, increasing sales to continental Europe and the rest of the world.
Sales to continental Europe have seen the biggest increase, jumping from £31.01m to £46.06m in the space of a year.
Sales to the rest of the world also jumped £4.5m from 10.18m last year, and an increase to £30.67m from £29.76m in domestic sales helped to stave off a fall in sales to north America.
The American market has taken a fall since last year, having purchased £18.12m worth of cars in 2016.2017, to £12.35m in 2017.2018.