British Leyland’s 164,000 employees in the United Kingdom were told yesterday that profits in the last financial year were not insufficient for a sweet shop round the corner, let alone a corporation of its size. The comment came from Mr John Barber, the corporation’s deputy managing director and finance chief.
In a report on company progress, which is being sent to every employee, he said: “After deduction of tax, profit was £21.1m which represents a profit margin on sales of not much over 11 per cent or 12p in the pound.”
During the year shareholders had provided £50m additional money but the company could not continue to raise and borrow money indefinitely unless profitability justified it. In a wide-ranging review of problems and prospects Lord Stokes, chairman, said:
“Our investment policy in the last few years has been inhibited to a degree by the uncertainty in obtaining industrial development certificates for expanding certain of our plants, particularly in the Midlands. Approval has recently been given to increase our car capacity in the Midlands and we can now make progress.”