Silverstone happy with financial future despite 2010 loss
The British Racing Drivers' Club's latest financial results show that Silverstone made a before tax loss of £1.9 million in 2010, but circuit officials insist there is no cause for concern.
The circuit's turnover increased by 23% on 2009 to £48,580,000 but increased costs, partly due to the extensive redevelopment of the site, meant the overall before tax losses increased by £0.6 million.
Gross profits were £1.4 million lower than 2009 at £12.8 million, but the circuit explained that "this was solely due to the combination of a shorter Formula One British Grand Prix sales cycle (tickets were on sale for 7 months, rather than 12 months), as well as an increase in costs associated with the new Formula One fee structure."
Managing director of Silverstone Holdings, Richard Phillips, said the company had been investing in its future over the past year, with the opening of the new 'Wing' pit and paddock complex earlier this year.
"The business is currently investing significantly in its future use and expansion," he said. "Accordingly, the 2010 financial results contained some exceptional preparatory and planning related costs. The underlying rental income and core costs remain strong and in line with expectations.
"Our costs are well controlled and overheads remain in line with revenue levels. There is strong demand for our leisure and racing offers, and the careful management of our product mix continues to underpin the Group's performance.
"Silverstone is now one of the premier motor sport venues in the world, run by one of the most experienced teams in the business. We believe that the returns from continuing investment will result in a strong upturn in profitability in future years, and plan to further increase profitability through a combination of continued diversification of income streams and by continuing to improve control over costs."
Stuart Rolt, chairman of the BRDC, said that the venue's future is looking bright with the British Grand Prix secured at the circuit until 2026.
"The headline is an operating profit of £1.6 million and a net loss after tax of just over £1 million, but we are very pleased and encouraged by these results. It is important that people are aware of the underlying success and growth of the business.
"In the last two years more than £40 million has been invested to improve the circuit and the venue's facilities, in particular the new Silverstone Wing complex, which was officially launched in May 2011. While this investment has significantly increased relative depreciation and interest costs in the short term, it has provided the platform for Silverstone to significantly grow its circuit‐related business in the long term which, in turn, will result in future profit growth.
"This investment has secured Silverstone's long term future. With a 17‐year Formula 1 contract [16 years remaining] and a five‐year MotoGP contract [4 years remaining], Silverstone is now uniquely positioned as one of the leading two and four wheel motor sport destinations in the world. I would like to thank the Silverstone Holdings Limited team, led by Neil England and Richard Phillips for their excellent work."