MAY 7, 2003
There has been talk for some time about Bernie Ecclestone perhaps buying into CART as a means of expanding his business and helping to get Formula 1 more firmly established in the United States of America. The company has just released its first quarters financial statements and they make fairly frightening reading with revenues up from $5.6m in the same period last year to $6.2m but expenses in the same period rocketing from $7.6m last year to $20.6m this year. This is mainly due to the fact that CART is supplying financial support for the teams, which amounted to $11m in the first quarter. Teams are paid a maximum of $42,500 per car per event in addition to the prize fund. This was necessary to ensure that there were enough cars in the series. CART estimates that it will spend $33m on this in the course of the year. In addition it is committed to spending $16.1m on TV coverage. In the first quarter CART's TV advertising sales brought in only $189,000 in revenue.
There was one extraordinary item in the accounts, the purchase of the organization which runs the Miami GP, which cost $1.2m.
The result of all this was that CART made an operating loss in the first quarter of $14.4m. The good news is that CART still has $70m in the bank.
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