Lotus Group has posted a £2 million profit for the year ended March 31, 2008 in comparison to a £4.9m loss last year.

The group said improvements in efficiency, cost cutting measures, steady sportscar sales and increased third party engineering had contributed to the turnaround.

Lotus ramped up investment in research and development over the year, spending £11.9m in comparison to £6.1m last year.

However turnover was down from £133m to £108.8m.

Mike Kimberley, Lotus chief executive, said: “These results are a tremendous turnaround achievement for Lotus.

“We are tracking our strategic five year plan which enables Lotus to deliver an exciting new range of vehicles, develop and sell new advanced technologies through our global operations and engineering client base and ultimately put Lotus on a greener and firmer footing and a consistently profitable commercial basis for the future.”

Over the past year, Lotus has set up new departments within engineering which are focussed on biofuels, electric and hybrid electric vehicles. As a result, six different electric and hybrid demonstration cars will be delivered to different global customers over the next year.

Kimberley said: “We are closely watching the state of the global economy and it is obvious that the world is changing very rapidly.

“By being small and flexible, Lotus is set to deal with the new demands from our consumer and business customers and over the last few months, the demand for our environmentally sustainable technologies has increased.”