UCI financial accounts published

Thursday, 29 September 2011

UCI logo

Accounts are boring but often the money is not. I’ve done the hard work for you and here are some “highlights” of the UCI’s annual financial report.

First note it is from the year ending December 2010, some time ago but the wheels seem to turn slowly in Aigle and despite being approved by auditors in May, it took until September to agree to publish the accounts. Numbers are Swiss Francs (CHF) and today’s exchange rate is at the foot of this piece.

  • The 2010 World Championships brought in CHF 11.9 million, account for 47% of the UCI’s annual income.
  • Of this the road races in Geelong provided the majority of income, some CHF 8.5 million or one third of the UCI’s total income.
  • The road competitions generate more than the combined income from track, MTB, cyclo-cross, BMX and other disciplines combined by a considerable margin.
  • Despite several big name sponsors like Tissot, Skoda, Santini, Shimano and others, oddly not a centime of income from sponsorship was reported but some goods were received in exchange.
  • The strength of the Swiss Franc, one of the world’s last hard currencies, has been a headache for the UCI. Many of its costs are in Swiss Francs but many revenues come in Euros and US dollars. This has led to an unfavourable move in the cost-revenue ratio and has prompted financial losses of over a million francs.
  • Overall the UCI made money from its activities, taking CHF 2.2 million in “operating profit” but lost on financial results.
  • The separate anti-doping body, the Cycling Anti-Doping Foundation is notionally profitable, collecting more in revenue than it racks up in expenses.
  • About 60% of the money used for anti-doping comes from the teams, with 40% from the UCI Pro Tour squads and 19% from the Pro Continental Teams, that’s three times as much as race organisers contribute during the season.
  • Unlike many Swiss companies there is no mention of salaries paid to senior executives. The UCI spent CHF 6.3 million on payroll and it employs 63 people, implying an average salary of CHF 100,000.
  • The UCI has a full-time finance director now in Alain Siegrist, formerly an accountant at Ernst & Young.

Pro Tour logo

The UCI accounts also include notes on the Pro Tour, the top “league” of teams and the calendar of races. Whilst not a separate legal entity, some useful numbers are explained.

  • The ProTour has an income of CHF 2.2 million and over half comes from the teams.
  • It seems very expensive to run, with some CHF 602,000 being spent on “Council Management”, CHF 498,000 going on marketing and CHF 632,000 on “legal and finance”. I had assumed the set up costs last year were high but expenditure seems ongoing.
  • €445,000 was siphoned off to create the Global Cycling Promotions company that will run the upcoming Tour of Beijing.
  • It awarded €30,000 to the GP Plouay in order to help the race with a tight budget.

Summary
Overall the UCI seems in decent financial shape although it has got its fingers burnt by moving exchange rates. The sport is heavily reliant on men’s pro road racing which alone appears to generate more income than every other aspect of the sport combined. Note the use of €445,000 to create Global Cycling Promotions is something that has caused private frustration amongst some teams.

The full accounts are available at uci.ch.

1 Swiss Franc = €0.82 / US$1.12 / £0.72 / AU$1.10. For example to get the equivalent in Euros, take a Swiss Franc figure above and multiply it by 0.82. Thus CHF 10,000 x 0.82 = €8,200.

@Ffreddie23 September 29, 2011 at 11:37 am

Fantastic work – keep the UCI on their toes, it’s not (or shouldn’t be) a private gravy train!

Ronan September 29, 2011 at 12:10 pm

The lack of sponsors from the World Championships is very strange, while the ‘flabby’ expenses for running the Pro Tour are hardly surprising.

It’s disappointing that an annual report raises more questions than answers.

cthulhu September 29, 2011 at 1:21 pm

“The separate anti-doping body, the Cycling Anti-Doping Foundation is notionally profitable, collecting more in revenue than it racks up in expenses.”
Doesn’t this sound peculiar to you? As a team (owner) paying for that I wonder why they should make a profit? Either they are not using the money fully, meaning not testing/researching enough, or I am paying too much.

SlapshotJC September 29, 2011 at 2:12 pm

Global Cycling Promotions…… How many directors or senior executives of this company have the surname McQuaid one wonders…….!!

Matti von Kessing September 29, 2011 at 4:00 pm

Does it bother anybody else ethically that the organization responsible for approving events for the UCI calendar is now putting on races? Shouldn’t promotion be completely removed from the body that is overseeing promotion of the sport? This seems like a conflict of interest to me. Possibly a power move by the UCI to take away negotiating rights from major promoters in Europe? I agree with Slapshot on this one, it stinks of entrenched nepotism.

chad September 29, 2011 at 4:12 pm

I totally agree with Matti about the uci promoting a race. The teams should boycott the race.

Ronan September 29, 2011 at 4:14 pm

@Matti

I’m sure the reasoning, however dubious, is that they are organising events in territories where nobody else is trying to develop the sport. It all ties in to the McQuaid vision of globalising cycling and tapping into new markets. I’m not sure if there is a viable alternative to doing it themselves at the set-up phase. Maybe they should tender the rights to organise certain races iwth UCI financial support? But then what happens when the president’s family members are involved in tender bids? It’s a very messy scenario.

Matti von Kessing September 29, 2011 at 4:26 pm

@Ronan

I see the logic in that line of reasoning, but I also see a donation of 30k to GP Plouay to help with the finances of that race. They’ve set a precedence, so why not follow through with it? The half a million they sink on additional bureaucracy to fund a race promotion arm would have been better spent as an award (competitive bidding? grant?) to a cycling promoter from areas that the UCI wants to expand to. At that point, they’ve helped to create an entity that actually has an interest in the area while also keeping the stink of scandal off themselves. The money stays in the community instead of being circulated back to Europe.

All this assumes that the McQuaid and the UCI have enough forethought to think these things through, something which you do a darn good job of proving otherwise.

The Inner Ring September 29, 2011 at 4:39 pm

Some earlier thoughts on the Global Cycling Promotions business are at http://inrng.com/2011/04/the-ucis-new-private-business/

What I can’t work out is whether GCP is owned by the UCI or by the UCI management as individuals. If is the latter then awarding themselves business is quite something but that sounds impossible. Either way there’s certainly another conflict of interest here for them to handle.

daniel September 29, 2011 at 4:44 pm

@matti ‘Does it bother anybody else ethically..’
Could say the same about the organising federation running the tests too.

What really sticks out is the lack of sponsor funds.

Ken September 29, 2011 at 6:26 pm

I’d mark the total lack of sponsorship funds with a big orange highlighter, indicating “Check more closely!” Are sponsorships handled under a separate entity? Is the UCI prohibited from accepting sponsorship funds? Something’s not right here.

Flashing Pedals September 29, 2011 at 6:38 pm

I agree with both Daniel & Ken.

Sponsors who don’t pay the organisation they sponsor, is puzzling.
Obviously, the funds are diverted into another channel, but which ones . . . . .

The Inner Ring September 29, 2011 at 8:02 pm

True. It’s one thing if one of the sponsors doesn’t pay during the year… but all of them?

Luc Prévost September 29, 2011 at 8:07 pm

Here is the official info for the GCP:
http://infocube.ch/en/c/6672936/global-cycling-promotion-sa

I have founded one member of the board, an ex-cyclist called Cattaneo Rocco.
http://www.les-sports.info/cyclisme-cattaneo-rocco-resultats-identite-s2-c2-b4-o5-w49953.html

Here is a some infos about his involvement with GCP:
http://www.moneyhouse.ch/fr/p/cattaneo_rocco-4529270/index.htm

He has been a member of the “Centre Mondial du cyclisme” since 2006.
http://www.moneyhouse.ch/fr/u/v/centre_mondial_du_cyclisme_CH-550.0.174.045-5.htm

I also have stumbled upon what seems to constitute the administration of GCP:
“Administration: McQuaid Patrick, d’Irlande, à Chardonne, président, Cattaneo Rocco, de et à Bironico, et Strebel Jean-Pierre, de Lausanne, à Prilly. Signature collective à deux est conférée à Siegrist Alain, de et à Vevey, secrétaire hors conseil. Signature collective à deux avec un administrateur est conférée à Rumpf Alain, de Vevey, à Ollon, directeur.”
http://www.moneyhouse.ch/fr/p/rocco-cattaneo

A side note: two other UCI groups (C.P.A., CYCLISTES PROFESSIONNELS ASSOCIÉS and FONDATION ARC-EN-CIEL) share the adress of a night club.
http://infocube.ch/en/c/4143375/eliane-ben-el-hadj

That must be bad for training, at the least.;-)

trounder September 29, 2011 at 10:17 pm

@Luc – great sleuthing… As we all know from comics, spy thrillers, and Hollywood, the “evil-doers” have secret Swiss bank accounts! Perhaps you’ve stumbled onto one of them…

fietsman September 29, 2011 at 11:02 pm

I would like
to
add to the thread that it
is SUPER that someone is at least willing to look into dark closets!!
Transparency in our sport is still dulled by blotchy port-holes.

Al Brodie September 29, 2011 at 11:23 pm

Great analysis! Love it! Raises a question.

Lot of buzz on the internet and magazines about revenue sharing “in order for pro cycling to move forward….” (from Alex Fairly “Odd Men Out” article in Velo, October 2011). In light of your excellent analysis on UCI’s finances I would love to hear your perspectives on whether revenue sharing is a viable option for professional road cycling. I don’t believe it is a business model that would be adopted or even work. I don’t see why the ASO and events would share revenue? Especially when most events are losing money or barely breaking even. The structure is so different from other professional sports. Your thoughts?

MK September 30, 2011 at 1:12 am

there is something funny going on with the Sponsors. Accounts receivable has them owing $500K to the UCi but the revenue hasn;t been booked in the income statement.

This is probably due toa dispute where the UCI doesn’t think it will recover the income.

I wonder if its due to a doping case or because the sponsors haven;t been able to use certain cyclists in promotional material!

Ilan Vardi September 30, 2011 at 11:51 am

Hello. I would like to point out that your estimate of a 100,000chf/year salary is incorrect. In fact, this is the average cost of each employee to the company and includes overhead such as benefits and other costs. So the actual salary is significantly lower by at least 20%.

-ilan

The Inner Ring September 30, 2011 at 11:55 am

Al Brodie: see http://inrng.com/2011/07/tour-de-france-revenue-sharing/ for some thoughts on this.

MK: yes, there are the receivables but to book nothing in 2010 is odd. Plus the receivables look rather modest.

Ilan Vardi: yes, it depends on the taxes and more and that’s why I used the word “implying”, plus I suppose on what we call salary, the amount paid or the amount received by the employee. There is more detail in the report about part time work and others, so averages are indicative only.

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