Optare has said that investments made in its latest financial year have ‘laid the groundwork for a better future,’ as it reported a substantial drop in sales and revenue.
In its first results since delisting from AIM, covering the year to March 31, 2016, the manufacturer reported a £19m drop in sales, and a 34% decrease in turnover from £57.8m to £38.3m, despite selling 253 single-decker vehicles and marginally improving its market share.
The business, which is 75% owned by India-headquartered Ashok Leyland, also reported a loss after tax of £9.3m, widened from £4.77m in 2014/15, which it attributed to factors including a contracted market, an absence of government funding for electric buses over the last two years and investment.
Optare said money has been spent on aftermarket quality campaigns, product development and taking steps to introduce the Metrodecker model to the market.
The overall UK bus market was said to have contracted by 7%, driven by a reduction in the single-decker marketplace.
Looking ahead, Optare said its focus was on further developing the next generation of increased range electric vehicles, growing the Metrocity passenger capacity and rolling out the Metrodecker.
It expects progress towards a profitable performance as the UK bus market grows.
Optare President, Graham Belgum, said: “2015-16 saw a signi?cant investment and effort put in widening Optare’s product portfolio and improving product quality, which has now prepared the company for a better future.
“We have the support of our parent company Ashok Leyland, which helped us tide over the volatile industry during the year, where Optare maintained its market share despite a decline in the single-deck industry volumes.
“We also made our operations more ef?cient and improved our resources in key areas which will deliver more value to our customers.”
A spokesman for Optare added: “The UK bus industry is facing many challenges currently. The collapse in local government funding for public transport has forced operators to withdraw from unprofitable routes and a number of high profile business failures.
“The market is awash with redundant, used buses which has seen the new UK single deck market drop by more than 40% year on year.
“Although the market has taken a beating, Optare’s market share has increased in the period. This increase in share has come from investment in aftersales and product quality at its Sherburn factory.
“While the current market outlook is gloomy, the company is confident that demand will return and is investing in improved and new products to meet that demand. In late 2015, Optare started demonstrating its new Metrodecker double deck vehicle with major operators around the country and is hoping for strong orders in 2017.
“Optare is a leader in the electric bus market, with more than 100 in service in the UK & Europe. The company has developed new variants, working in partnership with customers, that have increased range by over 30%.
“Optare plans to launch further innovations in the next 12 months.”
