2015 Harness Racing NSW Annual Report Front Cover: Champion Pacer Beautide Driven by Trainer James Rattray Pictured Winning the 2015 TAB
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2015 Harness Racing NSW Annual Report Front cover: Champion pacer Beautide driven by trainer James Rattray pictured winning the 2015 TAB. COM.AU Inter Dominion Grand Final at Tabcorp Park Menangle. Beautide was crowned New South Wales Horse of the Year for the 2014/15 season and by the end of that term had amassed earnings of $2,020,212. Picture by Brett Atkins. Contents Chairman’s Report 4 Chief Executive Report 6 Racing Highlights 10 Review of Operations - Finance 11 Summary of Financial Performance 16 Review of Operations - Racing 25 Review of Operations - Breeding 38 Review of Operations - Integrity 46 Review of Operations - Marketing & Media 50 Review of Operations - External Relations 52 Corporate Structure 53 Harness Racing Industry Consulative Group 56 Harness Breeders NSW 57 NSW Mini Trotting Association 58 United Harness Racing Association 59 NSW Standardbred Owners Association 60 Harness Racing Clubs Committee 61 NSW Trotters Association 63 Corporate Governance 64 Financial Statements Harness Racing NSW 68 Financial Statements Harness Racing Industry Fund 110 Financial Statements Racecouse Development Fund 123 Chairman’s Report Therefore, in total, more than $2.0m in bonuses were paid to participants. The combined prizemoney and bonus certificates paid during FY2015 were a record for the industry. Integrity continued to be at the forefront of deliberations within HRNSW. Management, backed by the Board, pursued a number of matters through the court system to ensure the integrity of the Act, the Rules of Racing and local Rules. HRNSW finished the year with a published surplus of $2.227m. The result was achieved following a substantial increase in TAB distributions, Rex Horne - Chairman well above budget expectations. TAB receipts increased from $33.458m in FY2014 to $35.651m this year, an increase of $2.193m. Income from the TAB reflected the shift from FY2015 was a year of change and infrastructure pari-mutual to fixed odds wagering, with the pari- development for the industry in New South Wales. mutual component decreasing by just over $1.0m Significant changes that occurred during the year and the Wagering Incentive Fee (WIF) increasing included a new CEO from 1 September 2014, a from $12.015m to $15.266m. A substantial revitalised handicapping system and more recent component of the WIF is fixed odds wagering. announcements from the NSW State Government This part of the revenue stream is becoming relating to tax parity and changes to race fields more unpredictable as it is highly vulnerable to fees. the yield achieved on fixed odds wagers. The Board continued its efforts to increase The entire surplus has again been earmarked in payouts and returns to all industry participants. the FY2016 budget for prizemoney, club funding Total prizemoney paid in FY2015 amounted to and breeding. $32.2m and included a combined $5.6m from Carnival of Cups funding, Breeders Challenge Total Turnover during FY2015 amounted to prizemoney funding, the Prizemoney Contingency $645m and average turnover per race increased Fund and Club contributions. This result was the by 3.3% from $169,278 to $174,875 per race. highest ever achieved by harness racing in NSW and was an increase of $0.860m on that paid NSW TAB turnover represented 25.9% of all during FY2014. turnover, Other Totes 39.5% and Corporate Bookmakers 34.7%. In addition to the above, the NSW Breeders Challenge continued to grow as a brand and its Year on year NSW TAB turnover decreased by worth can be measured, in part, by the increased 10.1%, Other Tote turnover decreased by 6.2%, success of locally bred horses on the national while Corporate Bookmaker turnover increased stage. by 15.1%. The Breeders Challenge Owners Bonus scheme The 2015 Inter Dominion was another distributed a record $1.3m in Certificates for use outstanding event with a large crowd attending in offsetting the cost of breeding, purchasing the final on Sunday 1st March. The revamped yearlings at Sales and 2YO’s at the Trialling Sale. series was once again the result of a tripartite The Breeders Challenge Nominators Bonus commercial accord between Destination NSW, commenced in FY2014. With the extension of the Principal Club (NSWHRC) and HRNSW. The the scheme to 3YO’s a further $0.743m in cash carnival also coincided with the World Trotting bonuses were distributed to Foal Nominators in Conference and Drivers Championships. FY2015. 4 HRNSW ANNUAL REPORT 2015 The win by Beautide, its second in two years was the 2015-2017 Strategic Plan was released something very special. Congratulations again to in May this year after much consultation with trainer/driver James Rattray for his outstanding participants and industry groups. Inter Dominion win. A Future Fund was established to manage the residual funds arising from race fields monies The Inter Dominion, carrying $750,000 in prize received during the period from September 2008 money, was just one of seven Group 1 and three to March 2012. The funds have been invested Group 2 events decided on the day delivering just for the benefit of the industry and some monies under $2m in prizemoney. were used for race funding during FY2015. Youth dominated our driving ranks with Lauren Many in the industry were dismayed to learn that Panella, Robert Morris, Todd McCarthy, David a number or trainers were severely affected Morris, Amanda Turnbull & Corey Bell all driving by the storms and floods that struck most of 100 winners across Australia during the season. the eastern seaboard in April this year. HRNSW provided much needed assistance to many While Steve Turnbull eclipsed 200 winners for trainers, especially those in the Hunter who bore the second year in a row, Shane Tritton was the brunt of the storm and its effects. able to achieve it for the first time in his career. KerryAnn Turner and Shaun Snudden also trained In June 2015 the NSW Government announced in excess of 100 winners. It was the second time that it would reduce the tax currently applied to for KerryAnn Turner and the inaugural occasion wagering to bring it in line with that charged in for Shaun Snudden. Victoria. However, the reduction will be phased in over a five year period. In late July a further There has been a significant amount of track announcement was made in respect of race and training centre development occurring fields fees which will enable HRNSW to charge throughout FY2015. higher fees for its product. The new track at Bathurst was completed and I would also like to thank my fellow Board officially opened on 19th October 2014 by The Members, Mr Graham Kelly, Mr Alex Smith, Mr Hon Troy Grant, Deputy Premier and Minister for Rod Smith and of course, former Board Member, Racing and included an eleven race program Mr Chris Edwards who concluded his term in that kept race goers thoroughly entertained February, for their significant contribution to the throughout the day. industry. Other significant projects commenced throughout In closing, I would like to acknowledge the Hon the year included the training centre at Menangle Troy Grant, Deputy Premier, Minister for Racing, Park, new lighting and stabling at Penrith and for his efforts and support of the harness project work for the new development at Wagga. racing industry. Thanks are also extended to Each track, including training tracks, receives the management team and staff at HRNSW an annual allocation from the Racecourse under the leadership of John Dumesny for their Development Fund for track maintenance. significant contribution over the past twelve In FY2015 a total of $0.680m was allocated to months. clubs and training centres. A new media centre, incorporating an upgraded Rex Horne web site, was launched in August 2014 and Chairman HRNSW ANNUAL REPORT 2015 5 Chief Executive’s Report In FY2015 wagering revenue from the traditional source (Tabcorp) was a record $35.65m although it should be noted that this amount was substantially influenced by non pari-mutuel turnover and non-racing wagering profits, calculated through the Wagering Incentive Fee (WIF). The WIF component increased by $3.25m which was attributable to higher yields from TAB Fixed Odds, returns from Trackside but in particular profits from wagering on sport. The FIFA World Cup (soccer) was a significant contributor to wagering turnover however as this Championship is held every four years its influence on income will not be experienced again until 2018. Two factors which will increase the income levels John Dumesny - CEO from wagering in the future are the Government’s Wagering Tax Rebate Scheme and the change to the regulation which determines the fee level for Despite the competitive nature of securing Race fields. wagering revenue, the key source of income for the industry, HRNSW recorded a $0.370m After relentless petitioning of the NSW comparative financial year surplus which was Government the taxation collected on wagers attained in a year that saw the distribution placed through Tabcorp will eventually be rebated of record levels of prizemoney, bonuses and to the NSW racing industry. The tax retained incentives. by Treasury is currently $3.22 per every $100 wagered. The Government has elected to phase The comparative financial year is best explained in this benefit which will see taxation reduced in that revenue of $10.769m has been included in to $1.28 per every $100 wagered in FY2020 the accounts under Race fields Income although although a substantial amount, estimated to be it should be noted that this amount is inflated by $6.5m is expected to be delivered to the harness the inclusion of a ‘fifth’ quarter of revenue. An racing industry in FY2018. amount of $1.857m equates to the ‘fifth quarter’ of the receipts from wagering operators other The amendments to the Race Fields Legislation than PGI.