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UCI cuts losses, ready to ‘weather the storm’

The UCI Headquarters in Aigle, Switzerland (by Bryn Lennon/Getty Images)

The International Cycling Union (UCI) has reported a net loss of CHF3.548m (€3.3m/$3.86m) in its 2019 financial report, but believes it is in a strong position to “weather the current storm” amid Covid-19.

The loss for 2019 compares to 2018’s deficit of CHF7.34m. The UCI said, like almost all institutions and businesses, it is facing many challenges in 2020 but believes its strong balance sheet makes it well-equipped to face them and continue to develop the sport.

The UCI reported revenues of CHF40.703m for 2019, up from CHF40.247 in 2018. Hosting fees were the main part of this (CHF10.594 v CHF10.904), followed by media rights and distribution (CHF8.987 v CHF9.54m) and commercial rights (CHF8.901m v CHF7.192m).

UCI chief financial officer Jeremy Conrad-Pickles noted that a pre-Olympic year is often one of consolidation with limited opportunities to grow revenues, however total consolidated revenues were 1.1 per cent above those of 2018.

The UCI has registered like-for-like increase in revenues of 28 per cent from CHF31.9m in 2015 to CHF40.7m in 2019, an annual growth of 6.5 per cent. Over the same period the UCI’s media and commercial revenues increased by 39 per cent, an annual growth rate of 8.5 per cent. The UCI’s rolling four-year cycle revenues have grown by 25 per cent from CHF152m in the four years to 2015, to CHF190m in the four years to 2019.

The 2019 revenues were 0.5 per cent below budget. Conrad-Pickles said: “The two key impacts on our margins in 2019 compared to our budgeted numbers were the UCI Road World Championships in Yorkshire, GBR and the revenue generating operations of the UCI World Cycling Centre.

“In a deviation from our usual model, the UCI retained all commercial visibility rights for the UCI Road World Championships and an uncertain economic environment in the UK made the sale of those rights very difficult; in addition, adverse meteorological conditions, combined with a lack of local readiness on the ground generated additional costs during the week of the Championships.”

The UCI registered direct costs of CHF29.213m in 2019, versus CHF28.797 in 2018, along with operating expenses of CHF18.408m in 2019 versus CHF17.404m in 2018. Financial support to international federations (IFs) from the International Olympic Committee in the form of loans or donations has reached $63m (€55.3m), IOC president Thomas Bach announced this month.

The UCI is one of the IFs to have received IOC loans, but with its total long term and short term deferred revenue totalling almost CHF30m at December 31, 2019, an increase of CHF8.3m from 2018, Conrad-Pickles says the federation has a “strong balance sheet” to face the current global crisis.

He added: “Our outlook for the 2021 – 2024 cycle is being reviewed as we assess the financial impacts not only this year, but also on sales prospection and contract renewals currently underway. The prudent management of the UCI’s reserves and the successful attribution of future UCI World Championships puts our federation in a strong position to weather the current storm.

“We had been looking forward to the start of our newly outsourced cyclo-cross UCI World Cup series in September and the recently announced UCI Track League in partnership with Discovery will launch in 2021. The long-form agreement with the Scottish Government for the UCI Cycling World Championships in 2023 was signed in November.

“There are many reasons to be optimistic about the future and the UCI’s ability to continue to reinvest in the development of cycling across the world. In spite of the above, we remain extremely cautious about the next six to 18 months and we are putting in place all necessary measures to safeguard the future of our federation and its financial security.”