A look at the team finances of the Ag2r Citroën team from 2022. It’s back in the days when the squad had brown shorts, Greg van Avermaet and more but these are the latest set of published accounts so a closer look.
2022?
This was the final season of the three year promotion-relegation cycle but the team were clear of the relegation battle thanks to a strong 2021 season. The team scored just 11 wins in the year, arguably saved by Bob Jungels winning a Tour de France stage and Benoît Cosnefroy taking the GP Québec while Ben O’Connor got the team’s other World Tour win in Catalunya.
The team’s biggest winner was Marc Sarreau with four wins in France. Greg Van Avermaet’s best result was a podium in the Omloop Het Nieuwsblad. The team signed four neo-pros and Felix Gall from DSM, a great hire with hindsight. At the end of the year they unloaded Bob Jungels, Lilian Calmejane and Clément Champoussin.
Writing up the 2022 accounts feels as fresh as a race review of Il Lombardia from the same year. But that’s they way it goes: accounts are compiled after the year ends, filed out of regulatory duty later, published even later by the local courts so that by the time a copy lands in the inbox it’s feels like an archive document than fresh data.
Le budget
The headline figure is 23,423,077 Euros.
The accounts show a loss of €776k which is both remarkable and irrelevant. Teams tend to break even so loss like this is unusual but it’s all covered by the backers so no problem and the accounts and the business get a clean opinion from the auditors.
Year-by-year
As one of the rare teams to consistently publish accounts we can track the numbers annually. 2022 saw the budget essentially stable for the year, a small decrease (for sticklers: the figure used for comparison over the years is the net number of €23.370 million which differs from the headline number cited above).
Now time to pick the bones inside the accounts.
The wage bill shows € 12.3 million in salary payments and a further €3.8 million in payroll taxes on top. As mentioned before here, French payroll taxes are heavy. Here 31% on top, a bill that teams in other jurisdictions don’t get. Of course their is a flipside, for example Axel Laurance told L’Equipe the other day that moving to Alpecin-Deceuninck has been great but he was surprised by the admin and bills he’s now go to make social security contributions for himself as his new team just pays him a monthly amount and the rest is on him. It’s why international comparisons of team budgets is a fraught job. Effectively Ag2r Citroën paid €16.1 million in order to get €12.1 million’s worth of riders on the jobs market.
Ownership and management changes
Another thing that stands out is the change of ownership. Team boss Vincent Lavenu started out in team management in the 1990s and the legal entity “France Cyclisme” started in 2002 but during 2022 this was sold to Ag2r La Mondiale. Or rather to Ag2r and La Mondiale was while the sponsor trades under one brand, its business each bought shares of the team, La Mondiale has 70% and Ag2r 30%. Lavenu is 68 year old and so his time at the team is probably closer to the end than the beginning… or let’s put it bluntly he’s said to be handing over soon. Lavenu is still with the team today in 2024.
He’s now supported by professional managers Béatrice Willems and Dominique Serieys. Willems has been senior with insurer Ag2r La Mondiale, running the chief executive’s office in Paris while Serieys has a sports management background, having run the Paris Défense stadium and held roles in motorsport. With these changes the team has gone from an EUSRL, a legal entity for a small sports team to an SARL, a regular entity in France for medium businesses. It’s a concrete example of teams changing from family businesses to professional outfits.
Bad debts ongoing
If you can read the screengrab, and this year’s accounts are hardly hi-res, the team’s accounts list €1.4 million of “créances doubteuses“, accounting jargon for bad debts. Loyal readers will remember there was a beef with Factor and a claim of unpaid payments lodged.
So the company switched late to Merckx bikes, supplied by Belgian Cycling Factory – the firm also behind brand Ridley – but again this proved unsatisfactory with another claim of missing payments. In lieu of payment the team kept the team bikes rather than return them and the 2022 accounts list stock of 60 Eddy Merckx bikes, down from 85 the previous year. There are shown valued at their original price of €206k (about €3.4k per bike) but presumably gathering dust and depreciating fast (the frames were not loved by the riders, the parts a combo of Campagnolo, Mavic and Rotor). The debt provision and the stock of Merckx bikes suggests both the Factor and Belgian Cycling Factory cases were not settled by the end of 2022 by which time the squad was on BMC bikes.
Citroën deal
This was the Citroën era. The accounts mention a €6.1 million sponsorship amount and that the agency which landed the deal can collect up to €1.3 million over the three years of the deal, but payments far total €742k. €1.3 million for an agency is a bumper payout but it’s 7% of €6.1m x 3 = €18.1 million. For teams hunting for big brands as sponsors it’s something any team would grab.
It’s a reminder that teams hunting for outside sponsors not only have to find and nurture them, they can also pay for them so there’s a gross amount and a net amount, something teams backed by billionaires or national governments don’t have.
HQ + staff
Elsewhere the team has taken out a one million Euro loan to renovate its HQ in La Motte-Servolex but has yet to make big draw downs. It doesn’t own the HQ, it leases it. As an aside Strava followers could guess Victor Lafay was going to join the team because he made several rides from his home in the Alps to the Ag2r service course last summer.
Team HQs are part office-space, part workshop, part parking lot and these days have a full-time staff inside with logistics managers and more. Indeed while we see the team as the riders, the 30 or so riders are only a fraction of the 71 staff cited in the accounts, up by one on the previous year.
Conclusion
The accounts are for 2022 but they’re the latest available, official and reasonably detailed. We get the headline budget number and some detail within. The year shows a similar budget to the previous season, the “Citroën effect” of the automaker giving the team a big financial input although this was mixed for the output, it allowed them to hire Ben O’Connor and Bob Jungels who would both shine for the team but also Greg Van Avermaet and a Flemish cadre that didn’t.
Behind the scenes this was the year Ag2r La Mondiale took ownership of the team but this leaves more questions now Decathlon are the lead sponsor and in 2024 and beyond the team budget will increase. Past bike sponsors caused headaches with unpaid contributions and that’s something they’re unlikely to have with Decathlon.
“60 Eddy Merckx bikes, down from 85 the previous year. There (they?) are shown valued at their original price of €206k (about €3.4k per bike) but presumably gathering dust and depreciating fast”
This jumped out at me. Pro-quality bikes ridden in the WT at less than $4K per? Makes one wonder about the $15K “halo” (IMHO bling-mobile) bikes pretty much every bike brand features these days. Obviously the pros don’t need them and there’s nothing that seemingly loses “value” faster than a brand-new one of these things. I see ’em on used bike sites only a season or two old for 25-50% of their original MSRP.
I wonder if the obscene profits from these are worth the perception they might cause – that road cycling’s a hobby only for a-holes with way more dollars than sense, especially for an industry that is suffering from oversupply and low demand?
These are the accounting value from the deal, the “trade price” rather than retail. But they’re also Merckx bikes with a mix of parts from 2022, hardly premium items in their time either sp probably not worth paying that much more for either.
OK, what do you think they were worth when new and freshly handed over to the team, assuming the Belgian Cycling Factory built them up? I’d say still far less than a $15K bling-mobile. Reminds me of back-in-the-day when some vacation/TdF clients were aghast at the bikes the mixed Telekom/ZG squad were riding – they had Campagnolo Chorus parts on them rather than top-of-the-line Record. “Oh, the humanity!” was their attitude.
As mechanics we just laughed to ourselves – as if the parts on the bikes would make any difference at all.
But that’s the power of marketing! IMHO SRAM is example #1
How much, probably €6-7k retail? A lot and you’d question the value, it’s neither aero or light, a chunk going on the “Merckx” label and the Campagnolo parts.
Escape Collective have a excellent recent article and podcasts on ‘why top level bikes cost so much’. I won’t spoil the conclusions but profit margin to all the steps in the supply and retail chain add to the trade price.
If the beef is with Merckx than is the listed price for the bike or the frame only.
The accounts do mention “bikes” rather than frames. Probably most of the bike without being able to be more specific.
Some bike deals are for the whole thing but it varies. The simplest deal sees the sponsor supply everything, for example Soudal and Bora get Specialized bikes with wheels, tires and they supply Shimano parts to match. Then you get the next tier like Ineos or Groupama where they have a frame sponsor and then Shimano as a named sponsor. Then you get teams with more mix and match deals, so if you see a team with, say, Mavic wheels or Rotor cranks then it shows they don’t have a component sponsor like Shimano or SRAM and have had to go and get different parts. Some teams even buy parts, for example EF/Slipstream long used to buy their Shimano groupsets although of course from the distributor rather than retail.
It is a good thing that the brown is gone.
Ah, I can’t agree. Not that I particularly cared for the kit, I wasn’t seeking replica shorts, but it was a real point of difference and helped identify the riders in the bunch. Even their most recent kit did a good job of that. However, their brand new kit looks pretty smart on its own but is completely anonymous in the middle of the pack.
What are some other good examples of kits that stand out in the bunch? Sky’s black with the blue stripe was so good DSM copied it for a while!
Polti’s kit is hard to miss though IMHO it’s not very pleasing with the red shorts.
I guess ya gotta be ancient to remember the blue-jean/overall look of Carrera or Castorama? Love ’em or hate ’em they at least had some originality and fit with the sponsorship philosophy.
Just one “La Vie Claire”
It was unusual but I always thought if you saw the brown for real outdoors, especially on a sunny day, it worked a lot better than in print or on TV. “Better” though, rather than “must have”.
Possibly unintentionally ahead of its time with a lot of brands doing non-black shorts now, there’s navy, dark green, grey and so on.
Ah, loved those Castorama kits. For some reason it prompted a flashback to the WordPerfect kit. A one season wonder before they became Rabobank?
I could get well into the weeds on this subject which is only now loosely related to AG2R!
Don’t forget the seasons that the team was Novell before becoming Rabobank in 1996.
Recall that Toshiba were doing white and red bib shorts back in 1988. And Banesto were using blue bibs in the mid 90’s.
Non-black bibs are not anything new and AG2R were late to the game.
the ag2r branding was made by a high profile dutch company studio dumbar. not sure if the bike kit as well but most likely yes. it was and still is to me a different approach especially compared to (pardon my french) traditional italian contilevel jerseys full of brands tossed onto the triko. colours and the famous brown shorts included. the worst example of a design was imho sagans national champ jersey during the liquigas era.
“the worst example of a design was imho sagans national champ jersey during the liquigas era.”
Really? I had to look that one up. What was so terrible about it? I can see a general love/hate for the Liquigas green kit, but they were hard to miss in the peloton!
My pick for awful might be that thing Astana made Nibali wear – the one with the Italian flag turned 90 degrees so it looked like Hungary’s ..but upside down.
I gave my friend the USA Nalini importer/distributor some real grief over that one…WTF?
https://cdn.mos.cms.futurecdn.net/vSKzov6hzwVQozAHTzZBbW-1280-80.jpg.webp
there was one with a horizontal flag on a white background, that was slightly better than the one in the link
Controversial take
Could a team save money by paying the riders as contractors instead of full time salaried staff. It presents a different tax arrangement that could work in the Teams favour if done correctly.
Not when employed in France as to cut a long story short a “professional cyclist” has a formal legal status as a salaried pro rather than contractor. You can’t call yourself a “pro” in France just because you race at elite level, it’s a particular status and as a salary. It also extends to Conti, third tier, teams where riders are all salaried, get social security etc whereas in many other countries they might get, say, €500 a month, a free bike and jerseys.
See the mention of Axel Laurance above, now he is employed by a Belgian team he has this “contractor” status and has to pay out of his pocket for French social security cover.
Maybe the social charges here limit the ability of French teams to match overseas squads on rider salary or contract, but riders such as Ladagnous will appreciate having made 17 years of pension contributions (cotisations) when he finally retires. The benefits of even a partial career in France can be substantial and are maybe more secure that pensions in some other countries.
It comes in other ways too. When many riders were asked, or just forced, to take pay cuts when racing stopped because of the pandemic, French teams had more support. And while a rider on a big six figure salary who might have already paid for their home with cash being asked to take a paycut isn’t necessarily a hardship behind the headlines times were tough for staff on other teams. Here the insurance meant managers, mechanics, soigneurs etc got paid so they could meet their rent, credit payments etc although whatever staff the team has, they probably take on extra help during the year too.
But also it’s not France vs wild west, the UCI rules mean all riders have to have comprehensive health insurance for the World Tour and Pro Conti teams and so on.
The contractor scheme seems always a tax dodge that is eventually ended. Lot’s of those “gig-economy” rackets exploit the hell out of their workers while maximizing profits for their rich owners. Pro cycling doesn’t need Ubers, Lyfts, DoorDash, JustEat, etc!
Dunno (or care) what the Escape Circle Jerk Collective thinks about top level bikes..I was referring to the $15K bling-mobiles that aren’t usually what the teams get though some of what they do ride have MSRP’s close to that. My guess is markup is why they cost so much..they figure why not get whatever the market will bear? “A fool and his money”…as they say.
Too funny. ECJC. I audibly laughed at that one.
So did I. I thought I was the only one not enamored with that site’s self-satisfied tone and style of writing.
Speaking of brown shorts, the Belgian football team are wearing them in the pouring rain at Wembley in the friendly football match against England (together with light blue shirt). I’m trying to remember to e last time I saw a football team wear brown shorts and failing.
They seem like a likeable team but if the budget has gone up by 2.5x they seem just the same as ever when it comes to results.
Also what is with ‘Alain Philippe’ ??? I remember it being a thing but not more and Google tells me it is a luxury watch brand.
The budget increase shows the inflation in the sport. We’ve seen the same with other teams, Ineos going from €20 million and dominating to €50 million but no longer even dominating as others caught up. It’s partly why last week’s topic of budget caps has come about, the “price” of sponsorship has soared.
Alain Philippe was a social media thing that mocked people in France who just tuned in to the Tour de France and didn’t follow much of the sport for the rest of the year, the kind of people who didn’t know Alaphilippe from Alain Philippe. The pic at the top has actually got the real, original meme in cardboard form from the people that launched it.
“Alain Philippe was a social media thing that mocked people in France who just tuned in to the Tour de France and didn’t follow much of the sport for the rest of the year, the kind of people who didn’t know Alaphilippe from Alain Philippe.”
I totally missed that. 🙂 Pretty funny and accurate based on my visits to Le Grande Boucle over the years. It’s like RAGBRAI in Iowa, USA…I used to laugh when I said anything about cycling there…the question was usually “Have you ever raced in the RAGBRAI?” while the local cycling club prez looked at me like I had three heads when I mentioned Francesco Moser while trying to sell a bike with his brand logo on it. I think he thought I was talking about the Pope!