The earning figures for Formula One are a big story today, with Bernie and the teams getting a raise in income. But there is something wrong here that I need an accountant to explain. My arithmetic obviously does not work in the world of accounting. The gross revenue for F1 is reported at $1.08 billion. The teams received $658m divided between them, not equally of course. Bernie received $7.9m and the net income is $296m. So $117m seems to be an operating cost. It is then reported that CVC LOST $660m! Now to my mind this means that CVC's costs are $296 + $660m, yes/no? Now CVC is a venture capital group, so apart from some management fees, this must be interest on the debt? Is that possible? No wonder they are looking to sell F1. What am I missing?
Joe Saward has a piece that goes a bit further into illuminating the ever shifting world of F1 management.
http://joesaward.wordpress.com/Formula One Administration has just transferred the F1 rights to a sister company Formula One World Championship, which is owned by Bernie's holding company SLEC which is in turn held by - well read it, I do not have enough space. Eventually we get to Delta Topco Ltd which has CVC and others as shareholders. You could lose a lot of money going through that lot, which is presumably the point. Other snippets is the sale of Instanbul Park between internal companies, presumably the F1 track the Turkish Gov't couldn't make pay, for $1, yes one dollar, an $11m write off apparently, but then how much did the Gov't write off? What does that say about the value of all those other monuments to ego and foolishness called F1 circuits?
In other news the Brazilian Federation has asked the FIA to look at the Interlagos track. Pedrosa has had successful surgery to unplug an artery trapped under the ironwork put in his shoulder after his accident last year. Let's hope he recovers quickly and is back in form to mix it with Stoner and Lorenzo. Jan Magnusson's son is setting fastest times in F3 testing, and Tony Fernandes is saying the name row is hurting sponsorship. I know how he feels, sponsors do not like uncertainty, especially over the person selling them something really has the right to it. I had exactly that problem with Eastern Creek when the owners were trying to sell sponsorship for the MotoGP that I was promoting. By the time that was sorted the time left for sponsors to exploit their investment was so short the value was greatly reduced.
Rain is forecast in Malaysia for the F1 race, fancy that, and in the monsoon season too. So, no movable wing and no more answers as to how it will improve overtaking, but there will probably be enough in the wet anyway.
Kimi had his first taste of NASCAR truck racing at a half mile oval and apparently did well. It was behind closed doors, so no real information is available, but it does not sound as if he stuck it in the wall.There are reports he is paying $100,000 a race for the ride, but I'm sure a sponsor will be all over that.
Bernie Ecclestone,
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