It’s Halloween and what’s more frightening than ghosts and ghouls? Running out of money.
Here’s a look at plucky underdogs Intermarché-Wanty and their latest set of scary accounts.
2023?
The accounts are for calendar year 2023 and they’ve just been published by the National Bank of Belgium.
It was the year Rui Costa enjoyed a revival, winning at the start of the season in Majorca and the Japan Cup at the end, with a Vuelta stage along the way (pictured). There were big hopes for Biniam Girmay but only a Tour de Suisse stage to show, even if there was plenty to put down to experience. However the team had a solid year for UCI points, at one point in the spring they were Belgium’s top-ranked team, ahead of Quick-Step, Lotto and Alpecin, then finished the season in 14th place to give them a head start in the 2023-2025 relegation battle.
So what’s the budget?
You might have clicked hoping for the big fat number. Sorry, it’s not clear as in the accounts only the gross margin is shown rather than the top line of revenue. But a note to the accounts says the team recognises it needs to count on €14 million in revenue to match €14 million in outgoings, but that’s for today and not 2023’s accounts. Absent the precise number we can use this number conversationally.
The lowest budget?
If it’s €14 million then it probably is the smallest in the World Tour; Lotto-Dstny boss Stéphane Heulot said this week in L’Equipe he has “less than €15 million”. Over in France Arkéa-Samsic have a higher gross number but because of French payroll taxes the net amount on spent on cycling like wages that touch rider bank accounts, staff, transport and so on could be less. So if every team published accounts comparisons would be clumsy; Visma-LAB have a women’s and U23 development teams while Ineos don’t, and that’s before comparing jurisdictions.
The key point
If there’s no top line budget number what’s the point of a whole post? Don’t worry, this blog is not here to produce filler for clicks. Instead the real story is a hefty loss. Again.
Loyal readers will remember the team racked up a loss of a million Euros in 2022 and this triggered all sorts of internal warnings, reviews and cost-cutting pledges. The result? In 2023 they lost close to a million Euros once more, €926,863 to be precise. Here’s a screengrab from the accounts, 2023 in the left column, 2024 on the right:
This is alarming. The accounts explain the team was able to keep going thanks to extra funding, with €500,000 injected by the unnamed shareholders and a two million Euro loan from one of the team’s sponsors (it’s unknown which one, Wanty have been known to be generous and supportive and top-up before. But two million, it could equally be Intermarché). This extra funding is welcome: rider wages get paid, the team races on. But it’s unsustainable. In the team’s own words (my translation):
the income was clearly insufficient to cover the operating costs of a World Tour cycling team
This has left the team with substantial debts. Normally team accounts show little on the balance sheet because they have few assets nor liabilities to report, they don’t own stadiums nor take out loans. But this time we can see plenty in the screengrab here:
There’s a host of dettes, debts to be paid: loans, taxes, wages and more. This in itself is maneagble if the team can get money to repay them.
The result of all this means the accounts report accrued losses of nearly two million euros:
Now for the good news
These are the latest accounts but they’re for 2023 and the ghouls and goblins of the past might be banished today. Notes tagged to these accounts come following a board meeting held on 10 October 2024 and we get some almost live insight into the team finances too. These cover recent activities and the “image of the team and the good results” [thanks Biniam] have encouraged the team’s main sponsors to up their contributions.
Also the team has been careful with recruitment, the accounts say they’ve not made any crazy signings (their word “folie“, not a word you expect to read in accounts). Plus they’ve cut back on racing: (translation):
races offering few UCI points and bringing the least TV visibility have been removed from the program
Looking ahead the notes sound more confident with partners on board for 2025 and beyond that are willing to put more money in. Although part of this may go on repaying debts rather than actual bicycling, unless the loans are written off.
Look at the roster and you can see the effects of the cost-cutting today. The team is all about Biniam Girmay but he doesn’t have big lead-out; his first stage win in Turin during last summer’s Tour partly happened because team mate Mike Teunissen was supposed to lead out Gerben Thijssen but things went wrong in the chaos… and the rest is history.
Conclusion
We often talk about team budgets as set amounts for the year. But budgeting is an art too. Sponsors can sign up to provide fixed amounts only for the team to overspend because fuel costs rise, a smaller supplier goes bankrupt mid-season, or ironically a rider wins big triggering cash bonuses (which in the short term are expensive, even if in time success can help bring more sponsors and riders). Random things can happen but going a million over budget is a lot for a team around the €14 million mark; especially if it happens all over again the next year.
The team are very lucky to have sponsors willing to loan them money. Less flexible backers might say “we’ve put in what we agreed” and leave it at that… and with two million missing the team could even be in existential trouble, a scary prospect.
However the added notes are reassuring, they talk of getting the hang of being in the World Tour from a financial sense and the team is confident for next year and beyond.
How much did they spend on Girmay? That’s the question I would ask. Did they pay more than he’s worth because of all the hype? Did they hope that would translate to sponsorship money?
He’s a very good rider, but the over-hyping is ridiculous.
He won three stages and one of the 4 jerseys in the world’s biggest race this summer.
The pay isn’t known but his success at the Tour saw him get a new contract, which suggests the previous one covering the accounts in question above was not so high otherwise they would not have needed to revise the deal.
What have you done for me lately?
When I think of overhyped racers it’s certainly not Girmay who comes to mind.
I don’t know about anywhere else, but D+ UK massively over-hype. They’re so desperate to show how liberal they are that they don’t seem to realise that it’s racist to treat someone as ‘special’ based on their skin colour. It’s white saviour complex.
One example from D+: Dani Rowe said his first TdF stage win was a victory for all of Africa. They don’t even get that that’s racist. Someone from Mozambique celebrates an Eritrean win just as much as someone from Romania celebrates a Spanish win.
Aren´t you prejudiced towards Romanians? 🙂 Racist attitudes are very real, but if one wants to look for them, there is no end to where one can find them – even where there isn´t one.
An Olympic gold in cross-country skiing for an Italian was a victory for all of the non-Scandinavian (or -Nordic, if you prefer) and non-Russian/Soviet cross-country skiing world – and basta!
I hate the stupid and ignorant waving here and there of the waving of the w-word, but we are living in an absurd world, if one has to be very, very cautious about expressing one´s excitement about an up-and-coming young rider because of his ethnic origin, nationality or skin colour…
You just treat him like any other cyclist. That’s it.
(And don’t talk about Africa as if it’s a country, ideally.)
No idea what the w-word is, btw.
bingo
Easy folks, let’s stick to the team rather than an exploration of some English-language sports reporter’s hot take of a Girmay sprint win.
For the accounts it doesn’t matter that much where he comes from, but three stages + green is just huge for the lowest budget team. The team did well to sign him when the Delko team collapsed, the likes of Arkéa must be kicking themselves.
Possibly an overhyped comment there…
J Evans – doesn’t matter who the rider is, but 3 stages plus green jersey at the Tour. Podium placings at several other classics.
All while having very little top end support.
Sounds like that rider deserves a high contract. And he is only 24, with years of growth ahead.
Good read. Is there any way to get a breakdown of the way the money gets spent from the accounts?
Not much. There’s a line saying wages are €9,696,555 but this might not be the total wage bill, although it could be close as it fits the typical proportion of wages as a share of a team budget. Also the accounts list 18 full time employees and 3 part time, presumably staff and their wage bill is €925,374 for the year. Otherwise there’s no info on fuel costs, vehicle leases, team bus purchases and the other big non-wage costs.
Thank you. Ten million for thirty means average pay is €333,000. Now I imagine nobody is paid the average makes me think who is above and below.
On some teams there’s probably nobody on the UCI minimum wage, many neo-pros these days can start on six figures etc. But anecdotally Intermarché might have some close to the €40k rate, the team can say to riders “the World Tour, how about it?”. Even if Girmay is on a big deal, it’s interesting to try and work out who the other big ticket riders are.
Any idea how much the average DS makes? Mechanic? Just curious what the non-rider staff cost a team.
Andrew, numbers are from same year as above and average for a DS is €75k and for a mechanic €38k in the World Tour…
…but these are averages. Is the DS in charge of recruitment and management or are they are driving the second car sometimes? Similarly teams will have a senior mechanic who may also run logistics, the service course… but others who might be on €25-30k for the year and as well as washing bikes the day job includes scrubbing the team cars etc; they could earn more in the proverbial LBS but of course they want the experience of being out on the road, sharing in the wins etc. Plus some can be hired part time, as cover for busy racing but they’re not needed for a lot of the year.
See, it’s posts like these that keep me coming back to Inrng year after year after year.
Under another recent article I wondered if teams are obliged to accept their promotion, and here we see Intermarche taking a while to get the hang of WT finances and refining their calendar to better suit their new reality. Like the dog that caught the car? Perhaps, but unlike the dog (and Arkea?) it seems they have some hope of working out how to build on their success. And I hope they do, because they’ve been great to follow over the last few seasons.
Teams aren’t obliged but I think it just makes sense if they’re close to it. There are some savings to be had out of the World Tour but being in also means bigger “participation fees”, just this week in L’Equipe Lotto-Dsnty boss Stéphane Heulot was saying it cost €60k to go and do the two Canadian races but if his team was in the World Tour the travel is supplied by the organiser and expenses paid out. Teams sitting in 19th-20th place can hope for a Tour invite but say Girmay has a horror injury, suddenly they don’t score the points, they’re not invited etc. World Tour status for a team that’s 15th-20th is like insurance but just that, cover and hopefully the team has a wider project and ambitions.
Wow, if it really only cost 60k to do both Canadian races that seems like quite a bargain. It cost me nearly 20k for my family holiday in Europe last spring!
These articles always make me shake my head about the sport we love. I’m wondering if Reggie Miller, noted cycling enthusiast (look it up, Euros), would be interested in having his own team. He’s probably got a few hundred million in the bank. It’s crazy to think how many riders are literally risking life and limb for the same salary that I make for my much less glamorous job!
Not only many teams are still financially “small”, but most were half of the current size only ten years ago and even as small as 2% of the now Big Ones not much further back than 20 years ago…!
That said, nowadays Reggie should find sponsors or being himself one, but to fully sponsor a middle to small level team would drain his whole estimated net worth (if it’s what I read about online) in less than five seasons.
Giant cyclist anyway ^___^
Many bike industries are smaller than one would expect, too, which is why bigger players with no interest in a healthy market with quality products are able to blow it up out of pure volumes, behind-the-scene commercial agreements and financial leverage. Microsoft anyone? 😛
I kept all the old accounts on file and saw Tinkoff’s from a decade ago. The super team of the day with Sagan and Contador as well as Basso, Rogers, Kreuziger, Majka etc… €22 million, Sky were €24 million.
Mr. Ring, that is crazy! Sky, the “megateam,” still cost less than one good footballer or one American athlete in one of the “big” sports.
Gabriele, I think “drain” is the operative term, which is why ideas like One Cycling remain so attractive…
Reggie Millers looking good.
HAHAHAHAHAHAHAHAHAHAHA
Was
The host will know better but i the fees to join the WT never used to all that high. Probably a bigger cost was having to hire extra riders which i guess could be near min pay rate for a lower ranked team. Plus the race fees but i suspect for races outside of Europe the race fees and travel cost may be covered. Come to Adelaide in Jan and we cover your travel and hotel costs – that sort of thing.
The ability to say to sponsors we are guaranteed to do all the big, televised races must surely be worth it to cover the extra costs in extra sponsorship.
JV – couldn’t agree more, these posts and then the back and forth in the comments. Especially on a slow news day, I love skimming through this on a quick break from work spreadsheets.
Thanks Inrng – as an accountant, I love these financial reporting pieces.
An interesting note about doing less races. Jayco alula the team i generally support seems to do a lot less low ranked races then some of the teams they combat for the WT spot. It was a real problem in the previous 3 year cycle as teams they were competing against for the 18th spot really raked up the points in French and Belgium races in particular.
But i guess it’s part of a way to reduce costs and keep the riders fresh for the big races. But it also means the lesser riders don’t get their own chances to shine.
Yes, Greenedge have long had a policy of not doing smaller races, and because they’re just not on the radar for their sponsors. It keeps riders fresh but the only downside is a large team of riders there are some who may want more race days but that’s on them to plan and agree calendars. As we saw though in 2023 this changed and they started to do those smaller races in the hunt for points.
Thanks. That’s interesting context about the travel fees and expenses. A trick of how the rich stay rich – wealthy celebrities with access to free clothes and luxury items equates to well (or better) financed world tour teams getting access to subsidised race programmes while those with aspirations spend to keep up.
Though I suppose some of this is at the organiser’s discretion – if they really wanted a certain rider at their race, I’m sure they could stick their hands a bit further in to their pocket.
Watching Koppenberg Cross and it reminded me about the Wanty cx team, Charles Liégeois Roastery. Are they run completely separate from the road team?
I think it’s part of the team and “Continuum Sport”, which is the legal entity behind the team (it was behind BMC and then CCC, then Wanty bought the WT licence from them when CCC stopped)
INRNG always, always, with the deep knowledge that the professional journalists wish the could string together so eloquently. Keep doing your thing please!
As noted the team is largely(entirely) based around Girmay’s ability to poach some big wins from the scraps dropped by MvdP, Pogacar, Remco and Van Aert. Which is basically the odd smaller classic and the ever diminishing sprint days at Grand Tours. It’s not exactly a sustainable model (though historically fairly commonplace in cycling), and in a sport where season ruining crashes happen pretty much every day that must make things fairly nerve wracking for all involved.
If find talking about the budgets of cycling teams always very confusing, is there any clear definition what that means?
Is it revenue, or costs? Is it only the cash part? Or does it also includes the value of the barter deals like the bike, cars, nutrition etc.? Does it look at the profit and loss perspective (which could have non-cash items like depreciations)? Or the cash flow perspective (which could have non PL items like the redemption of debts)?
If only we could explore more details. The few teams that do publish accounts do it out of legal obligation and tend to supply the minimum info possible.
We’ve seen past Ag2r and Groupama-FDJ accounts which have touched on the barter value for their bikes and other things (including detail like Bell paid $230k to GDFJ to use helmets, Lapierre paid €1.5m).
Which all makes comparisons between teams harder still, especially as Pinarello and Specialized pay a lot more than Lapierre, including some times wages and deals to riders; while Colnago is effectively controlled by the same UAE prince who oversees the team so it’s not a commercial deal.
That’s something to explore – the way bike manufacturers within cycling go about sponsorship and team ownership. Trek have long had a named team, but are a bit of a standalone now, when once – even fairly recently – it was common to have three or four bike manufacturers in title sponsor positions.
As far as I am aware Specialized have never had their own professional road team, but have used their money to fund other teams and riders on those teams (Sagan in particular). But what drives that choice?
And now we have Decathlon as a title sponsor (team owner?) who can fit out any cyclist at any level head to toe in their own branded gear.
(This is really just a way of saying I’m looking forward to the annual “who are the sponsors” post).
It’s also why budget and salary caps are harder to implement, nothing stops the UCI from capping, say, Pogačar’s salary but who would stop Colnago paying him a separate endorsement on the side… or the UAE from gifting him apartments in Dubai, from paying him to be a tourist ambassador etc, all as long as he’s part of the team and so on. Not that it can’t be done, but you’d have to levy the teams and organisers to fund a small army of international accountants.
An interesting idea I’ve read about in fans’ forums is capping… UCI points (like, there’s a cap for your 10 best on roster).
I haven’t thought much about it, but maybe loyal readers here would find it an interesting POV to explore.
A budget cap under the current organisational reality of the sport is very hard to implement.
I’m not sure about budget caps – I appreciate there are extremes of income and expenditure across the peloton but it’s still a relatively inexpensive top-line sport for sponsors.
On the Cycling Podcast this week they spoke about Pog’s new contract and pay deal, but pointed out it was the equivalent of the salary of James Ward-Prowse a fairly average premier league player (with above average set-piece delivery).
Ok – it’s not comparing like for like in terms of market opportunity for sponsors. But thought that was an interesting comparison!