Jaguar Land Rover Reports Strong Profit And Cash Flow For Tæhird Quarter Of Fiscal 2020/21

Jaguar Land Rover Automotive plc today reported strong financial results for the three months to 31 December 2020 (Fiscal Q3), with improved pre-tax profits and its best-ever third quarter cash flow.

Fiscal Q3 retail sales were 128,469 vehicles, up 13.1% on Q2 but still 9% lower than pre-Covid levels a year ago. Sales in China were up 20% on the prior quarter and up 19.1% year-on-year. Most other regions were also up on the preceding quarter while down from the prior-year third quarter. Sales of the new Land Rover Defender grew to 16,286 units, a 66.0% increase on the prior quarter.

Profit before tax (PBT) was £439 million (after £37 million of exceptional charges), up £374 million from Q2 and £121 million from a year ago. The significant improvement reflects revenue of £6 billion, up £1.6 billion from Q2 while still lower than pre-Covid levels a year ago, with favourable sales mix, cost performance and partial reversal of prior-period reserves for emissions and residual values. EBIT margin improved to 6.7% (+400bps year-on-year).

Profit and cash improvements from the Project Charge+ transformation programme in the quarter were £0.4 billion, including £0.2 billion of cost and £0.2 billion of investment efficiencies. Savings year-to-date total £2.2 billion, and the company is well on track to deliver the £2.5 billion target for the full year ending 31 March 2021.

Free cash flow in the third quarter was £562 million, primarily reflecting the strong PBT and favourable working capital after £675 million of investment spending. Cash and short-term investments increased to £4.5 billion, including $1.35 billion of five- and seven-year bonds issued in the quarter. Total liquidity was £6.4 billion including a £1.9 billion undrawn revolving credit facility.