Jaguar Land Rover has returned to profitability in the second quarter of the financial year.
The car maker saw an 8% rise in revenues and posted pre-tax profits of 拢156m for the period from July to the end of September.
The turnaround in fortunes comes despite a slight decline in sales overall, with soaring sales in China coming as a welcome shot in the arm for the manufacturer.
The results have in part been attributed to demand for the new Range Rover Evoque and Range Rover sport models.
Revenue increased 8.0% year-on-year to 拢6.1 billion, driven by higher wholesales (up 2.9%), though total retail sales were down slightly (-0.7%).
Perhaps the best news for the period was a sharp improvement in the company鈥檚 performance in China, where sales rose by 24.3%.
Global retail sales of the new Range Rover Evoque increased by 54.6%, while sales of the Range Rover Sport rose 17.5%.
The all-electric Jaguar I-Pace also continued to be a hit with retail sales up by 2,593 vehicles.
Pre-tax profits of 拢156 million in the quarter represented a 拢246m increase over the same period in 2018.
Jaguar Land Rover said its performance reflected favourable wholesale volume and mix, operating costs, depreciation and amortization, and foreign exchange.
Profit margins also improved with an EBIT margin of 4.8% and an EBITDA margin of 13.8%.
Watch: The new Land Rover Defender
The company鈥檚 Project Charge transformation programme contributed 拢162 million of cost savings and a 拢285 million reduction in investment spending in the quarter.
With cost savings of 拢2.2 billion to date, Jaguar Land Rover says it remains on track to achieve targeted savings of 拢2.5 billion by the end of March 2020.
Prof Sir Ralf Speth, Jaguar Land Rover chief executive, said: 鈥淛aguar Land Rover has returned to profitability and revenue growth.
鈥淭his is testament to the fundamental strength of our business, our award-winning products, new technologies and operating efficiencies.
鈥淲e were one of the first companies in our sector to address the challenges facing our industry.
鈥淎s such, it is encouraging to see the impact of our Project Charge transformation programme and our improvement initiatives in the China market start to come through in our results.鈥
Free cash flow was negative 拢64 million for the quarter, a 拢559 million year-on-year improvement.
This reflects both better profitability and a 拢154 million decrease in investment spending to 拢841 million for the period.
At the end of September聽 Jaguar Land Rover had cash of 拢2.85 billion and a 拢1.9 billion undrawn credit facility.
Since then the company has completed a 拢625 million five-year amortizing loan facility backed by a 拢500 million guarantee from 海角视频 Export Finance (海角视频EF) and signed a new 拢100 million working capital facility for fleet buybacks.
The company is also in the midst of a product offensive which saw the new Land Rover Defender unveiled in September. Deliveries of the long awaited model, which defines the Land Rover brand, will begin from spring 2020.
September also saw the opening of the company鈥檚 new Advanced Product Creation Centre in Gaydon.
Looking ahead to the end of the financial year in March 2020, Jaguar Land Rover said it is expecting a year-on-year improvement and to target a 3-4% EBIT margin with cash flow increased over last year.
Paying tribute to Jaguar Land Rover鈥檚 workforce Mr Speth added: 鈥淥ur people have responded very positively to the challenging circumstances over the past year.
鈥淭he improved performance this quarter reflects their ongoing passion and determination. 鈥淟ooking forward, we will continue our product offensive, broadening our range of electrified vehicles on the journey towards our Destination Zero future.鈥
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