Cycling South Africa is pleased to share its Audited Financial Statements. The annual report that shows what has transpired in the organisation in the previous financial year shows remarkable improvements, both in income generation and the reduction costs year on year.
2017 revenue shows an amount of R19m, which reduced to R10.5m for year-end 2018. This is largely due to the grant income from KZN Department of Sports and recreation, moving to KZN Cycling for the continuation of a grass roots development program, which has seen 12,000 youth having access to cycling and participating, from the 11 districts around KZN. The program is showing great results, with some of the youth participating in SA championship events, and medalling in their respective age categories.
Cycling SA generated a surplus for the year – prior to sporting costs and adjustments. The surplus increased by 36% to R1,233,265 for the 12 months. This has been adjusted downward after finalisation of a long outstanding right back of VAT – which was raised as debtor in 2017. This matter has been finalised, after the receiver finally passed the necessary entries in February 2018. This dates back to 2015. It is important to note that this is not a cash transaction but an accounting transaction, to balance our debtors and VAT account.
Cycling SA reduced outstanding liabilities by R2,251,972 during 2018, and although liabilities stand at R2,605m, this is largely made up of unutilised grant income at year end. There is still a long term creditor (UCI), which repayments have commenced on time – this dates back to losses incurred hosting the 2013 UCI MTB World Championships.
Administration expenses reduced by a further 9%, making the organisation very lean on administrative costs, being 78% of net revenue resulting in a net operating margin of 22%. Cycling SA has cleaned up its balance sheet, and now the focus will be on revenue generation and sporting expenditure as we move to qualify for Tokyo 2020, across all five disciplines and both genders.
Cycling SA’s Annual Financial Statements will remain qualified, as we have no finite process to determine exact levy and day license income generated by and received from events. Levy and Day license income attributes to 18% of Cycling SA net revenue – (before grant income). Cycling SA is working for increased compliance to ensure parity across all events and disciplines, to ensure increase in realisable revenues that can be attributed to sporting costs/athlete support and development.
Looking forward, the federation estimates a net surplus of R1.3million for 2019, prior to sporting expenditure, with a nominal increase in administrative costs (5.5%). Grant income will be R4.6million for specific projects, as applied for. Cycling SA has launched its AGENDA2020 policy, on development and qualification programs for Tokyo 2020.