Despite its on-track successes in F1 2023, Red Bull’s profits were eclipsed by a surprise rival team in Alpine.
Several team’s finances have been revealed through the UK’s Companies House, reflecting their financial positions for the 2023 season.
Red Bull’s finances up, although profits shrink
With 22 out of 23 races won in 2023, Red Bull‘s on-track dominance translated into an increase in turnover from £278.03 million to £307.47 million.
Its gross profits increased a little, up from 2022’s £2,272,000 million to £3,050,000 million for 2023.
After tax, its profits were £1,296,000 – a decrease from 2022’s £2,057,000, due to a corporation tax adjustment, which was increased by 4.5% compared to ’22. The increase in the main rate of corporate tax was enacted from the 1st of April 2023.
The team’s cost of sales, ie. the cost of going racing, rose from £253,130,000 to £287,780,000, eating into its profit margin.
The increases in the cost base are “primarily driven by success-based payments, reflective of the team’s performance on track in 2023”.
The report also reveals the remuneration paid to its highest-paid director, who was paid £7,000,000 in 2023 – more than double what he earned in 2022. Subtracting from the total directors’ remuneration reveals the sum paid to Helmut Marko as RBR’s sole other director – he received £190,000, separate from any remuneration he received from Red Bull GmbH.
In its business review, Red Bull made a point of highlighting the growing influence of North America in F1 alongside its own on-track successes, and said: “Commercially, the team’s performance continues to be exceptionally strong, acquiring seven new partnerships, five of those HQ’d in the US, a territory the team has continued to generate mass appear in.
“In addition to these new partners, the team also renewed four major partnerships, two of which are over four-year deals, demonstrating commitment to the long-term ambitions and value that the team offers brands.”
While RBR’s accounts suggest only a tiny profit margin, it’s worth pointing out that, as an entity, it is tied together with Red Bull Technology and Red Bull Advanced Technologies – Red Bull Technology boasted post-tax profits of £11 million for 2023, while Red Bull Advanced Technologies made a post-tax loss of £35,000.
Williams’ losses accelerate as balance sheet takes a hit
At Williams Grand Prix Engineering, revenues shrank from £142,846,000 to £126,965,000 with its cost of sales rising from £70.8 million to £86.6 million – still less than a third of Red Bull’s.
Gross profits shrank from £72 million to £40.3 million, while expenses rose from £135.5 million to £161 million. This means that, once all expenses and taxes are paid, Williams made a net loss for the 2023 season.
The losses of 2022, which were £17.8 million, accelerated to £84.2 million for 2023.
The amount of money handed over to the directors Matthew Savage and James Matthews as director remuneration was £80,000 – down from £563,000 in 2022.
In its business report, Williams said: “For the year ended 31 December 2023, revenue was £127.0m, and the loss after tax was £84.2m.
“Whilst losses have increased compared with 2022, this is in line with expectations and the Company’s strategy to continue investing in all areas of the business to drive both on-track and commercial performance in pursuit of success in the medium and long term.
“Revenue was lower in 2023 as a result of lower commercial rights revenue associated with finishing 10th in the 2022 Constructors’ Championship (2021: 8th). During the year, the Company disposed of £ 18.3m of its heritage assets at a realised profit of £3.5m.
“The balance sheet remains strong with net assets of £67.3m as of 31 December 2023 (2022: £116.4m), providing a sound financial base on which to continue the team’s long-term strategy of returning to the front of the grid and being financially sustainable.”
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