Jaguar Land Rover (JLR) has shattered its previous first-quarter revenue records. In the three months ending June 30, 2024, the luxury carmaker posted a turnover of £7.3 billion, a 5% increase from the same period in the previous financial year.
These impressive figures, however, reflect a 7% dip from the fourth quarter of fiscal year 2024, attributed to fewer production weeks in the first quarter of fiscal year 2025.
Record-Breaking First Quarter
Jaguar Land Rover (JLR) has reported its highest first-quarter revenue ever. For the three months ending on June 30, 2024, the luxury carmaker achieved a turnover of £7.3 billion. This marks a 5% increase compared to the first quarter of the previous financial year. However, revenue was down 7% from the fourth quarter of the fiscal year (FY) 2024, due to fewer production weeks in the first quarter of FY 2025.
Profit Margins and Cash Flow
JLR’s profit before tax and exceptional items stood at £693 million, a significant increase from £435 million a year ago. The company’s earnings before interest and taxes (EBIT) margin rose to 8.9%, up by 0.3 percentage points compared to the first quarter of the previous financial year. The profit after tax for the first quarter was £502 million, up from £323 million in the same period a year earlier.
Financial Position
At the end of the quarter, JLR had a cash balance of £3.8 billion and net debt of £1 billion. The net debt position improved by £1.5 billion year-over-year, but it was £300 million higher compared to the fourth quarter of FY 2024. This increase in debt was primarily due to an annual dividend payment of £387 million to its parent company and other non-operating expenses totalling £96 million.
Driving Factors
The positive financial results were driven by higher wholesale volumes and investments in demand generation. A favourable pricing environment also contributed to the positive results.
Future Production Constraints
Looking ahead, JLR anticipates production constraints in the second and third quarters. These constraints are due to the annual summer plant shutdown and flooding at a key aluminium supplier. Despite these challenges, the company is maintaining its full-year financial targets of achieving an EBIT margin of over 8.5% and net cash.
Investments and Innovations
JLR has committed to increasing its investment from £15 billion to £18 billion over the next five years. This investment aims to support the company’s Reimagine strategy. Additionally, the company showcased the new Defender OCTA, its most powerful Defender model to date, at exclusive experiential events before its public debut at the Goodwood Festival of Speed in July.
New Models and Collaborations
Development of the new Jaguar model is progressing well, with camouflaged prototypes undergoing road testing. In collaboration with its Chinese partner Chery, JLR has entered into an agreement to license the Freelander brand for a range of electric vehicles in China. These vehicles will be based on Chery’s electric vehicle architecture.
Reimagine Strategy and Racing Success
CEO Adrian Mardell highlighted the company’s strong performance and commitment to its Reimagine strategy. He also noted the success of the Jaguar TCS Racing Formula E Team, which won the ABB FIA Formula E Team and Manufacturer’s World Championships. The lessons learned from this racing success will be applied to JLR’s luxury electric vehicles.
Upcoming Electric Vehicles
Later this year, JLR plans to unveil its first next-generation luxury electric vehicle, the Range Rover Electric. This model already has over 41,000 customers on its waiting list, reflecting strong demand.
Manufacturing Plants in the UK
JLR operates production plants in Halewood, Solihull, and Castle Bromwich in the United Kingdom. These plants are crucial to the company’s manufacturing and production processes.
Jaguar Land Rover’s remarkable first quarter results reflect the company’s strategic moves and resilience. Despite anticipating future production challenges, JLR remains steadfast in its financial targets and commitments to innovation. Investments in new models and electric vehicles position the carmaker favourably for continued growth.