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Racing Board takes early lead with $70.9m interim profit

Despite achieving a higher than expected interim net profit, the New Zealand Racing Board is in for a long race, with plans to modernise the TAB to appeal to the younger punter.The board released its result for the six months ending January today, showing

Robert Smith
Tue, 11 May 2010

Despite achieving a higher than expected interim net profit, the New Zealand Racing Board is in for a long race, with plans to modernise the TAB to appeal to the younger punter.

The board released its result for the six months ending January today, showing that turnover, net betting revenue and net profit were all up on the same time last year.

Net profit was up 5.8% to $70.9 million, while the board recorded revenues of $830 million.

Even though the profit result was 4.9% ahead of the board’s budget, it is still expecting a slighter softer performance in the second half of the year and warned of “ongoing fiscal pressure” over the next 18 months.

The board has already shared some of the wealth with the industry after making an unscheduled distribution of $6 million in February.

NZ Racing Board's chairman, Michael Stiassny, attributed the result to wagering product innovation, the launch of TAB TV and a strong cost saving programme.

While the second half of the year is expected to be a bit tougher, the board is anticipating greater export earnings from its internationalisation programme and growth from the redevelopment of tab.co.nz.

The board has also faced the fact that the traditional TAB customer is not getting any younger and Mr Stiassny said that it will be necessary to bring in the next generation to future-proof the business.

“Someone in their 20s demands a completely different entertainment experience from someone in their 60s, and we are working hard to find solutions that cater for this group.”

The board is also keeping an eye on the future, with a recent series of industry meetings looking at the pressures the business is facing, such as the impact of overseas betting, and the co-operation that will be needed to overcome those pressures.

Mr Stiassny said it would be “impossible” to move the industry forward using older strategies and structures.

“We need the three racing codes to engage and support solutions that will grow the entire industry, not just those that support individual interest. There is no time for division.”

Robert Smith
Tue, 11 May 2010
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Racing Board takes early lead with $70.9m interim profit
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