McLaren Racing losses grew by £10 million in 2017

McLaren Racing Limited, the company charged with operating the group’s Formula 1 activities, posted a £13.2m loss last year, filed 2017 accounts show. The equivalent 2016 loss was £3.2m.

The company turned over £196.5m in 2017 versus £179.8 for the previous 12-month period, primarily from its F1 operation. Administrative expenses shot up from £54.9m to £70.7m, with headcount increasing from 675 to 706, although overall employee costs registered a negligible increase.

According to the filings, the employee split by department as at 31 December 2017 was: 354 heads in production, 260 responsible for design and engineering and 92 employees in administration.

Although not reported separately, McLaren’s share of Formula 1’s 2017 revenues is estimated at £75m (including £25m in historic championship bonuses), indicating that revenues from other sources were £108m, including £90m in sponsorship income. Honda, with whom McLaren acrimoniously split after last season, is though to have contributed at least £60m.

During the course of 2017, McLaren earmarked an unspecified number of historic cars for sale to collectors, and thus transferred assets worth £22m from its heritage division to sales inventory. The company anticipates selling these cars over the next two to three years.

As revealed by RaceFans in May this year, McLaren raised £200m by selling 800,000 shares to Nidala0, a British Virgin Islands-based company owned by Canadian billionaire Michael Latifi, father of F2 driver Nicolas. McLaren recently confirmed to investors that the deal will be completed in three tranches: £100m already received followed by £50m by the end of this year and a further £50m during 2019.

Having split from Honda and signed a subsequent three-year customer engine supply deal with Renault, McLaren’s Strategic Reports states, “The company’s objective is to build and strengthen our relationship with Renault and win races in the near future.

“In order to achieve these aims our focus is to ensure we continue to attract and retain the best drivers, engineers and support staff, and provide sufficient funding to the racing programme to build a car that can challenge at the top of the sport.

McLaren’s 2019 confirmed driver line-up consists of Carlos Sainz Jnr and rookie Lando Norris.

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