Adam Cooper F1

Williams Grand Prix Holdings has reported a loss of £34.3m for 2014 – but the company insists that this year will see a much better financial performance.

Revenues were down from £130.4m to £90.2m, but the much better results achieved on track last year will be reflected in more money coming in this season from both sponsors and commercial rights income.

In 2013 the group made a profit of £11.9m – when results were boosted by a significant extra payment related to the departure of PDVSA and Pastor Maldonado to Lotus.

In a statement the company noted: “In 2013, following a number of years of deteriorating performance, Williams embarked on a turnaround strategy to reinvigorate the performance of the Formula One team and put in place the foundations for a profitable engineering business. Consequently, and as anticipated, 2014 was a year of transition and the financial results reflect a year of higher costs in a sport in which commercial rights revenue is earned a year in arrears.

“The loss was driven by lower revenue and higher costs in the Formula One operation. More than half the reduction in revenue is due to the recognition of a one-off sponsorship payment for 2014, which had to be recognized in the 2013 financial statements. It was also the result of lower commercial rights and partnership income due to our ninth place finish in the Constructors’ Championship in 2013, and the impact of the sale of the Williams Hybrid Power business earlier last year. The higher costs were attributable to the introduction of the new hybrid power unit into Formula One, and investment in the Group’s operation to turnaround its performance.”

Group CEO Mike O’Driscoll noted: “Mid-way through 2013 we set out on an ambitious turnaround strategy to reinvigorate the Formula One team, create a strong and profitable Advanced Engineering business, and divest non-core activities. In 2014 we made very good progress against those objectives, investing significantly in people, facilities, and technology which we believe will provide a solid foundation for the future.

“The financial performance of the Group in 2014 reflected the poor on-track results of the prior three years, which resulted in a marked deterioration in commercial rights and sponsorship income. Last year was also adversely impacted by the costs of relocating our Advanced Engineering activities.

“Our much improved performance in the 2014 Championship will be seen in higher commercial rights and sponsorship income in 2015, coupled with improved performance from our Advanced Engineering division. Our ambition in 2015 is to consolidate the progress we made last year, continue building the necessary foundations for future sporting and commercial success, and consequently to materially improve our financial results for the coming years.”

After being out of the points for nearly 11 months Romain Grosjean made it two scores in eight days when he followed up seventh in China with the same result in Bahrain.

The Frenchman agrees that the Lotus E23 has put the smile back on his face following a dreadful 2014 season.

“I’ve had it since Day One,” he told this writer. “At least I can understand the car, I can play around with it, I can push hard, and it makes such a big difference to last year, where it was doing whatever it wanted, so I really hated it.”

He agreed that the double points finish was a big boost: “It’s good for all of our guys, and myself as well. I think we worked hard, we deserved them. The [Bahrain] weekend didn’t start in the best way, I had really a lot of struggle, and the first time we had a good car was qualifying. They did a good job to guess the set-up and go for it in the race. I’m very happy with that. A lot of tyre management of course, but it’s good to score some more points.

“Everything was on target. Having a new set of options would have helped the second stint, we should have managed to keep one from quali, as Red Bull did and other top guys. But the strategy was perfect, so that was good.”

Grosjean expects the close battle with Red Bull Racing to continue.

“In China in the race they were less quick, here they were quicker. It’s good to fight with them, and also in qualifying Sauber is quite quick as well, so there is a good group around who we can fight with.”

Force India supports Bernie Ecclestone’s plan to introduce a budget ‘customer’ engine that will run in competition with the current works hybrid V6s.

As outlined here yesterday Ecclestone supports the idea of making available a cheap V8 with KERS (or even a V6 twin-turbo with KERS) that independent teams could use at a much lower cost than current customer engine deals.

“I think the principle of maintaining the V6 hybrid is absolutely correct and proper,” Force India’s Bob Fernley told this writer. “From the manufacturers’ point of view it’s very beneficial both for their marketing and technical programmes. I don’t see any doubt that the hybrid has a long term future in F1.

“What Bernie is looking at is that the independent teams will be offered a ‘parity’ engine, possibly a V8 with KERS, at a half of the price at least of what we are paying today. Of course, as an independent team to be able to cut our costs down by half and have parity with the V6s is attractive. It doesn’t disadvantage us, we’re still putting on a great show.

“If say Cosworth brought in a V8 with a KERS system it would be a very, very good unit. The advantage to that is we’ve got an independent supplier, and there’s nothing wrong with that for the health of F1. I think Cosworth and Renault are the two operations that can do it.

The obvious drawback is that there will be a debate on how the FIA can ensure parity, but Fernley does not see that as a problem.

“At the end of the day the teams cannot survive on the current cost base. So I think Bernie’s initiative has got tremendous merit. Whether it causes a few issues in terms of discomfort in determining where parity is… Well there is already discomfort between where Mercedes are and where Renault are! You’re always going to have that.

“I don’t think it devalues F1. We run with different chassis, so why can’t we run with different engines? We’ve done it in the past, and sometimes it’s been successful and sometimes it hasn’t, but we haven’t got parity today.”

Fernley says there has been no move from the current suppliers to reduce the prices they charge the independent teams for the current engines: “At the moment it’s not on the table and it’s not something that the manufacturers want to consider.

“The only other thing that’s been on the table is to reduce costs, but not have a parity engine. Why would we want that?”