Operating loss squashed as RAC revs up

MOTORING organisation RAC Group has reported a strong jump in operating profits for the past year as a result of rising sales and lower costs.

Sales were £507 million and operating profits £67 million – a dramatic turnaround from last year’s £6 million operating loss. But Britain’s oldest breakdown service faced oneoff costs after reorganising debts, which resulted in pre-tax losses of £179 million.

However, it claimed the underlying performance meant 2016 had been a ‘tremendous year’. It said: ‘From a financial standpoint, 2016 was also a successful year for the RAC Group, a strong performance was achieved against a backdrop of difficult market conditions. The group delivered further growth in revenue while maintaining our earnings.’

The RAC is jointly owned by a Singaporean sovereign wealth fund and private equity outfit CVC.