Williams has become Formula One's latest victim of the economic downturn as the team's accounts show that its revenues and profits crashed last year due to the collapse of one of its key backers.

Analysing the accounts in the London Evening Standard Pitpass' business editor Chris Sylt reveals that Williams' pre-tax profits fell by 50% to £4.5m last year as its revenue fell on losing sponsorship from Baugur, the now bankrupt Icelandic business.

You will not have seen the Baugur brand on the car but most readers will remember the logos of the companies it owned adorning the Williams in 2008. At the top of the list was the toy shop Hamleys which had a logo on the car's sidepod and its owner gave Williams a right headache. Baugur reportedly owed Williams £10m for the sponsorship but failed to pay up when it hit financial difficulties. Although Iceland's Glitnir bank guaranteed to honour Hamleys' obligation it was taken over by the Icelandic government and Williams still hadn't received the money by the end of last year.

The loss of Baugur's money led to revenue at Williams plummeting 13.8% to £108.3m in the 13 months ending 31 December 2009 despite the reporting period being one month longer than the previous year. "Turnover was lower and it will be lower again this year," said Williams' chairman Adam Parr at the Turkish Grand Prix according to Reuters. "But costs were also considerably lower," he added. True, total costs were down by 4.8% to £102.9m in 2009 but this was no where near as big as the fall in turnover.

During 2009 Williams' research and development charge was down by £4.9m to £36.1m and the team made additions of only £166,627 to its windtunnel and R&D equipment and £357,379 to its plant and machinery.

Williams used its reduced profits to pay down debt and the team finished 2009 with cash of £3.9m compared to net debt of £25.5m at the end of 2008. However, the accounts state that this position is expected to worsen because £14.6m of the income it received last year was attributable to 2010. This comes at a bad time for the team since it will lose an estimated £11m of sponsorship at the end of this year when the Royal Bank of Scotland puts the brakes on its Williams partnership.

"This year I am expecting results at least as good as 2009, very similar," Parr told Reuters. However. the accounts indicate how hard it can be to meet projections as the directors' report quotes team principal Frank Williams saying that "the team finished seventh in the 2009 F1 Constructors Championship...key strategic changes have been made which will address the identified deficiencies in 2010 and beyond." The team's current position of eighth indicates that this strategy has yet to bear fruit.

Despite its poor performance, the team's highest-paid director, believed to be Williams himself, got a pay hike from £975,000 to £1.1m. Williams majority owns his eponymous team with a 63% stake but in 2009 he sold 7% of his equity as Austrian motorsport entrepreneur Toto Wolff became a shareholder and non executive director. This wasn't the only management change at the team.

Earlier this year, Parr became Williams' chairman after having been the team's chief executive since November 2006. Over the three years that he was the team's CEO it made a combined after-tax loss of £7.7m (see table). Parr's predecessor Chris Chapple was Williams' CEO from May 2005 until November 2006 and over those two years the team made a combined after-tax profit of £1.8m. Chapple is believed to have been the team's first CEO but, for the sake of comparison, in the three years before his arrival, Williams made a combined after-tax loss of £850,000. When it comes to bringing Williams back to its peak on track and off it, the team's new CEO Alex Burns has a long road ahead of him.

Year	After-tax result	CEO in charge for majority of year	combined after-tax profit per CEO period
2009	4,524,815	Adam Parr	-7,699,288
2008	9,182,604	Adam Parr
2007	-21,406,707	Adam Parr
2006	-27,701,014	Chris Chapple	1,835,082
2005	29,536,096	Chris Chapple
2004	743,095	N/A	847,310
2003	-955,432	N/A
2002	1,059,647	N/A