curious Posted November 22, 2019 Share Posted November 22, 2019 There is some reference to net betting revenue in another thread. This is from the SOI for FY19/20. Any thoughts? Looks like we are in for a much better year. Quote Link to comment Share on other sites More sharing options...
mardigras Posted November 23, 2019 Share Posted November 23, 2019 Based on what exactly? They have to be talking the piss to think they will generate an extra near $40m from racing and sports betting net revenues. Only 15% more than last year. Mind you, to sustain the distribution, that is what they need to achieve. If they don't, the remaining reserves of $24m (where this has come from, who knows), will be out the door. 1 Quote Link to comment Share on other sites More sharing options...
curious Posted November 23, 2019 Author Share Posted November 23, 2019 5 hours ago, mardigras said: Based on what exactly? They have to be talking the piss to think they will generate an extra near $40m from racing and sports betting net revenues. Only 15% more than last year. Mind you, to sustain the distribution, that is what they need to achieve. If they don't, the remaining reserves of $24m (where this has come from, who knows), will be out the door. Exactly. They are predicting this NBR and the operating savings in doing so to sustain the $25m reserves. There seems to be no explanation as to where this will come from. It would seem more likely that last year's 28m decline in NBR will continue. I think I heard Dean McKenzie say at the AGM they are already collecting 80% of the expected Racefields fees via voluntary agreements, so there's not much to come from there. If you believe the Treasury and DIA estimates and apply a bit of logic, the PoCC is likely to be negative revenue wise. Where the hell is the 40m supposed to emerge from? They could be completely insolvent by the time of the next annual report as far as I can see. Here's the SOI link for those interested. https://www.rita.org.nz/sites/default/files/documents/SOI_2019_Report_RITA_FINAL%401101.pdf Quote Link to comment Share on other sites More sharing options...
curious Posted November 23, 2019 Author Share Posted November 23, 2019 (edited) I liked this quote from Robbie Waterhouse in a recent "The Optimist" (ironic I know) blog in general reference to the dire state of things in NSW. " “I bought a racebook at auction the other day from the 1930s, and there was virtually no horse on the card that was owned by more than one person. Today, except for a few owners like the Sheikh, every horse is owned by 20 people. I think they would be better off slashing the prizemoney and bring the price of yearlings down.” Ten years ago I thought they had a chance to turn things around here with significant structural change. Without drastic change such as the above now, I don't really see any hope and the likes of NSW will lead or follow suit. Edited November 23, 2019 by curious 1 Quote Link to comment Share on other sites More sharing options...
ngakonui grass Posted November 23, 2019 Share Posted November 23, 2019 Thinking along the lines of something like that,we could have all our races for 25k and a maximum for Derby,Guineas,Oaks etc100k. Those that want to race a horse would still do it. Quote Link to comment Share on other sites More sharing options...
Hesi Posted November 23, 2019 Share Posted November 23, 2019 1 hour ago, curious said: Exactly. They are predicting this NBR and the operating savings in doing so to sustain the $25m reserves. There seems to be no explanation as to where this will come from. It would seem more likely that last year's 28m decline in NBR will continue. I think I heard Dean McKenzie say at the AGM they are already collecting 80% of the expected Racefields fees via voluntary agreements, so there's not much to come from there. If you believe the Treasury and DIA estimates and apply a bit of logic, the PoCC is likely to be negative revenue wise. Where the hell is the 40m supposed to emerge from? They could be completely insolvent by the time of the next annual report as far as I can see. Here's the SOI link for those interested. https://www.rita.org.nz/sites/default/files/documents/SOI_2019_Report_RITA_FINAL%401101.pdf It is underpinned by a combination of revenue growth including full year benefits from the new Fixed Odds Betting platform, recovery in elite betting activity, growth in gaming and other key revenue initiatives, and a reduction in operating expenses That's a big ask, to increase nett betting revenue by 37 mil Recovery in elite betting ?? Op expenses down, 1.8 mil, Gaming income up 0.5 mil, not huge What other key revenue initiatives? I note also that Turnover related Expenses are up from 69 to 81 mil, what's that all about Staff expenses down 10%, at least that is positive 1 Quote Link to comment Share on other sites More sharing options...
curious Posted November 23, 2019 Author Share Posted November 23, 2019 It's not a pretty picture. 1 Quote Link to comment Share on other sites More sharing options...
mardigras Posted November 23, 2019 Share Posted November 23, 2019 1 hour ago, Hesi said: It is underpinned by a combination of revenue growth including full year benefits from the new Fixed Odds Betting platform, recovery in elite betting activity, growth in gaming and other key revenue initiatives, and a reduction in operating expenses That's a big ask, to increase nett betting revenue by 37 mil Recovery in elite betting ?? Op expenses down, 1.8 mil, Gaming income up 0.5 mil, not huge What other key revenue initiatives? I note also that Turnover related Expenses are up from 69 to 81 mil, what's that all about Staff expenses down 10%, at least that is positive Remembering of course that the NBR referred to is unrelated to PoC or racefields income. And is unrelated to operating expenses or gaming income. So that requires punters betting with the TAB to be prepared to lose an additional $37m on sports and racing betting. I think it's a number plucked out of their arse. Some of the increase in turnover related expenses may well be due to a hoped for increase in racefields fees payable off-shore (from some of the extra supposed revenue from punters betting on racing). Quote Link to comment Share on other sites More sharing options...
curious Posted November 23, 2019 Author Share Posted November 23, 2019 9 minutes ago, curious said: It's not a pretty picture. The colours are nice though eh? Quote Link to comment Share on other sites More sharing options...
curious Posted November 23, 2019 Author Share Posted November 23, 2019 4 minutes ago, mardigras said: Some of the increase in turnover related expenses may well be due to a hoped for increase in racefields fees payable off-shore (from some of the extra supposed revenue from punters betting on racing). Maybe, or maybe they've been relocated from the general opex reductions? Quote Link to comment Share on other sites More sharing options...
mardigras Posted November 23, 2019 Share Posted November 23, 2019 1 minute ago, curious said: The colours are nice though eh? Very. Handout crayons at the AGM and let every one have a turn at colouring the charts in. Quote Link to comment Share on other sites More sharing options...
curious Posted November 23, 2019 Author Share Posted November 23, 2019 2 minutes ago, mardigras said: Very. Handout crayons at the AGM and let every one have a turn at colouring the charts in. They could still probably afford to do that. Quote Link to comment Share on other sites More sharing options...
mardigras Posted November 23, 2019 Share Posted November 23, 2019 5 minutes ago, curious said: They could still probably afford to do that. This year maybe. Next year, it will bring your own crayons. 1 Quote Link to comment Share on other sites More sharing options...
curious Posted November 24, 2019 Author Share Posted November 24, 2019 Probably BYO sammies and drinks and a gold coin to help keep the power meter going round as well. At least JA seems to have timed his departure well. They should be able to pay him till the end of the year and scrape up enough for his golden handshake. A question though. It appears the remaining $25m of equity includes $45m of intangible assets. Anyone point me to a listing or some detailed description of what makes those up? I don't see much in the annual report but may have missed it. Thanks. 1 Quote Link to comment Share on other sites More sharing options...
Hesi Posted November 24, 2019 Share Posted November 24, 2019 You might recall, there was a guy called Andrew Brown, who penned Racing Ahead, who wrote stuff like the below DRIVING REVENUE - maximising profit by delivering world-class betting products and services to customers Quote Link to comment Share on other sites More sharing options...
curious Posted November 24, 2019 Author Share Posted November 24, 2019 So are you saying the $45m of intangible assets are the " world-class betting products and services to customers "? 1 Quote Link to comment Share on other sites More sharing options...
Hesi Posted November 24, 2019 Share Posted November 24, 2019 Maximising profit World class betting products and services They are meaningless statements, because they can't be measured and therefore the writer can never be held to account Quote Link to comment Share on other sites More sharing options...
curious Posted November 24, 2019 Author Share Posted November 24, 2019 Because they are down in class, with blinkers on and a 4kg claimer steering on a heavy track, I've tightened them in to 100/1 to achieve the budget in the head post. They'll need to get their hands on the penetrometer readings though but should start performing well after Christmas. 1 Quote Link to comment Share on other sites More sharing options...
mardigras Posted November 24, 2019 Share Posted November 24, 2019 I thought the investment in software was part of that $45m. It would certainly be classified as intangible - but equally, that capital investment hasn't shown itself to be worth anything. So I'd be hoping that $45m does not include it - or the situation is dire in the extreme. Quote Link to comment Share on other sites More sharing options...
Sandpiper Posted December 4, 2019 Share Posted December 4, 2019 The intangibles are up from $8m FY18 to $45m this year. Its the website amd software yes. Page 19 of the annual report. Nothing unusual about the accounting - a 50 mil project isnt going to be expensed in year 1. It does however hugely weaken the balance sheet. For one thing it cant be sold. They didnt even engineer it themselves. Intangible assets is an area ripe for abuse even so a lot of the time items in there such as brands can have a realisable value. I think will we see effective nationisation of the betting operation with govt issuing bailouts to save face avoiding job losses etc while racing continues to operate at a loss. This is for all purposes the same as the industry issuing bonds against the eventual, inevitable, taking of the golden goose of monopoly to market. My personal view is borrow big and invest in world class night racing to hit asia in the morning their time. Theres no more money to be squeezed from NZ. We are the wealthiest we have ever been and still only punt 20 bucks on a rugby game. Give it up. Needs a strong hand at the tiller to do any such thing we are world class in no single associated process yet (broadcasting, track management, form, integrity, stewards etc etc). 1 Quote Link to comment Share on other sites More sharing options...
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