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To View Asset 2007 Annual Report RACING VICTORIA LIMITED ACN 096 917 930 2007 Annual Report Contents Chairman’s Report 2 Board of Directors 4 Chief Executive Officer’s Report 6 Executive Team 9 Corporate Governance 10 Operations 14 Integrity 18 Services 21 Development 24 Financial Performance 38 Financial Report 42 Annual Report published by Harding Media Services Pty Ltd, designed by Scarab Blue Design and printed by Fineline Printing. Photography by Bruno Cannatelli, SDP Photography, Getty Images, Victoria Racing Club, Melbourne Racing Club and Moonee Valley Racing Club. RACING VICTORIA LIMITED 1 2007 ANNUAL REPORT Chairman’s Report Racing Victoria Limited’s role as the peak body of the determine the appropriate aggregation model. In parallel, Victorian thoroughbred racing industry is reaching an the planning process will advance the other business important new phase in its brief history following the improvement opportunities presented within the RVL completion of a comprehensive industry governance and business case. business review. These landmark reforms provide a sound foundation for the That review commenced in October 2006 with the united industry’s future growth and prosperity. It is pleasing to endorsement of RVL’s members – Country Racing Victoria, note that they reflect a common desire from all corners of Melbourne Racing Club, Moonee Valley Racing Club and the industry to install a sharper and more effective the Victoria Racing Club – and its ten industry stakeholder governance structure in order to maximise returns for bodies. The prime objective of the review was to identify racing’s participants. any commercial, structural and operational changes Outside of the review process, RVL vigorously pursued its required to improve the industry’s business model and in strategy for investing in infrastructure development with particular, to examine the potential economic benefits from key achievements including the construction of Victoria’s the consolidated management of the industry’s intellectual first ThoroughTrack racing surface at Geelong and the property rights; improving race date allocation, completion of ThoroughTrack training circuits at Bendigo programming and prize money efficiency; and cost and Warrnambool. reduction through the expansion of shared services. The new all weather racing facility at Geelong immediately The review was undertaken in two parts with the well proved its value by allowing the recommencement of racing respected corporate management expert David Crawford following the closure of the course proper due to Stage 4 conducting an independent review of the industry’s water restrictions. The Geelong ThoroughTrack also became governance structure and Ernst & Young being retained to the mainstay for transferred meetings and for the fixturing oversight RVL’s preparation of a business case to of additional meetings. This showcase development has set investigate the economic benefit opportunities. new standards in occupational health and safety featuring After consultations on the review outcomes, the RVL Board plastic running rails and superior quality starting gates. determined in June 2007 to broadly adopt the Crawford Drought-Proofing Racing continues to be one of the Report’s recommendations for the introduction of a fully industry’s highest priorities and requires ongoing independent RVL Board structure and enhancing RVL’s investment in water conservation, stormwater harvesting capacity to allocate revenue for the benefit of the whole of and recycled water projects. The peak of the 2006/07 the racing industry. The Board also resolved to collaborate summer period drought wreaked havoc to the race program with the industry’s media, wagering and sponsorship rights and necessitated wholesale movement of race meetings holders to develop a business plan which will identify the from tracks unable to access sufficient water. specific intellectual property assets to be pooled and 2 RACING VICTORIA LIMITED CHAIRMAN’S REPORT Government funding support is crucial in meeting the RVL’s strong focus on improving participant welfare led to industry’s infrastructure improvement needs, particularly the adoption of significant changes to the apprentice jockey in respect to sustaining the extensive network of country program involving the creation of a pre-apprenticeship racing and training facilities. The operation of the $18.6 TAFE program and new financial support schemes for million Racing Industry Development Program has proven trainers and apprentices. Victoria University was invaluable in this regard and RVL looks forward to a commissioned to conduct a world first study into the positive outcome from the Victorian Government’s review welfare of trainers and stable employees which is expected at the end of the program’s initial two years. to identify extensive measures for supporting these key participant sectors. In issuing its pre-election policy statement, Racing in Victoria – Leading the Field, it was reassuring to read the The internationalisation of racing reached new heights in statement by then Premier, Steve Bracks, that his the 2006/07 racing season extending from the memorable Government “is committed to ensuring that the racing Japanese quinella of the Emirates Melbourne Cup; Miss industry is sustainable and continues to flourish”. Equally, Andretti’s domination of the Global Sprint Challenge, we appreciated the then Minister for Racing, John including a victory ahead of three compatriot horses in the Pandazopoulos’ intention that “it will be in partnership that Kings Stand Stakes at Royal Ascot; and in Japan, Takeover we ensure Victorian racing continues to lead the field”. We Target’s success in the Sprinters Stakes and Karasi’s congratulate both of these long standing supporters of extraordinary third time crowning at the world’s richest racing for their major contributions to the industry, and in steeplechase, the Nakayama Grand Jump. There is no doubt turn, now welcome the continued industry support being that these spectacular performances enhance the pre- provided by their respective successors, John Brumby and eminence of Victorian racing and our productive links with Rob Hulls. the other leading racing jurisdictions. The Victorian Government’s amendment of the legislation The exceptional growth of the economic value and drawing governing the maximum deduction rates from totalisators power of the Victorian Spring Racing Carnival was was another well received support measure which will illustrated again by a record gross benefit of $628.8 million, improve the industry’s revenue returns from wagering. record attendance of 772,719 and an estimated 120,000 international and interstate tourist visitations. The Carnival Race fields legislation generated important additional is indisputably Australia’s largest annual event. revenue through the first time capacity to obtain an economic contribution from non-Victorian wagering service In closing, I wish to thank RVL’s member shareholders, providers operating on Victorian racing product. The industry stakeholders and racing’s many business partners, effective enforcement of this legislation, combined with participants and patrons for their collective contributions to ongoing reforms to Victorian bookmaking regulatory a successful year of achievement. framework, will ensure that the industry maximises the I also thank the RVL Board, executive team and staff for revenue value of fixed odds wagering. At the same time, we their professionalism and commitment throughout the year. are progressively improving the sophistication of our In particular, I would like to acknowledge the contribution wagering integrity monitoring systems including the made to the RVL Board by Ray Orloff who retired at the unveiling of a pilot bet monitoring computer system which 2006 AGM and thank also his successor, Peter McCarthy. is providing RVL Stewards with unprecedented access to betting transaction information. Condolences are expressed upon the passing of two of racing’s genuine legends, Arthur ‘Scobie’ Breasley and RACING VICTORIA LIMITED 3 2007 ANNUAL REPORT Jim Houlahan. These great men of the turf will be sadly BOARD OF DIRECTORS missed, but their legacies will certainly never be forgotten. GRAHAM DUFF AM – CHAIRMAN (AGE 65) Finally, although outside of the reporting year, it needs to be • Director, Australian Racing Board Limited recorded that the outbreak of equine influenza in late August • Board of Governors, International Masters Games Association 2007 has posed the biggest ever threat to the Australian • Director, Mark Sensing Ltd racing industry. Thanks to the concerted efforts of the • Chairman of National Construction Management Services Victorian Department of Primary Industries, the participants Pty Ltd of the Victorian racing industry and the many participants of • Former Chairman, North Melbourne Football Club Ltd the equestrian and leisure horse sector, we have kept this • Former Chairman, HOSTPLUS disease north of the Murray. Clearly, the threat remains and • Former Chairman of Victorian Institute of Sport a long term strategy of heightened biosecurity measures and • Former Chairman and Managing Director of John Holland Group vaccination programs need to be employed to keep Victoria • Former Managing Director of Fletcher Challenge Construction EI free and to provide insurance against a future outbreak. (Worldwide) The economic implications of the outbreak are substantial and RVL is continuing to pursue funding relief to minimise THE HON MICHAEL DUFFY
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