LightsOut

The NZRB must follow the Racing Act as foremost..

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The New Zealand Racing Board’s (NZRB) new betting platform went live today (Monday 7 January) and is seen as a game-changer for the racing industry in New Zealand.

“This is the dawn of a new era for the NZRB and for New Zealand betting customers as we deliver a more compelling betting experience and  significantly enhancing the number of betting opportunities we can offer,” says NZRB CEO John Allen.

“We estimate this initiative alone will increase returns to the industry by $17 million – $19 million in annualised profit, rising to approximately a $30 million increase in net betting profit as a result of the Fixed Odds Betting change from 2021/22,” says Allen.

“Our customers will have access to more options than ever before on sporting events from around the world.

“We’ve replaced our existing website and app with a responsive, modern and easy to navigate site that delivers more products and events,” says NZRB CEO John Allen.

 The NZRB must follow the Racing Act as foremost they exist under the Racing Act  to maximise its profits for the long-term benefit of New Zealand racing.

Sporting bet now price and result all sports (maybe not NZ sports) they don't price or trade local or international racing. It is costing a large part of $17,000,000 a year to have them do that (Openbet share that payment).

NZ sporting codes received around $10,000,000 last year from the NZRB so obviously when the The Racing Act is followed as per 57 (e) the Sporting codes must receive a substantial reduction in funds in relation to last years payout when these new costs and charges are applied. This doesn't even take into account the $50,000,000 for the new website development which the CEO states above will open a huge increase in sports betting events from around the world

57 Application of revenue from sports betting
(1) The Board must apply the amounts received by it for sports betting, including the net return from bets laid off under section 54(2)(b)(ii), for a racing year in payment of—
(a)refunds of bets and winning dividends for that year, including payments to dividend prize pools that will be carried forward and paid out as winning dividends at a future date; and
(b)goods and services tax; and
(c)totalisator duty as prescribed by the Gaming Duties Act 1971; and
(d)the amounts agreed to be paid to New Zealand national sporting organisations under agreements entered into under section 55, being—
   (i)not less than 5% of totalisator sports betting turnover; and
   (ii)not less than 1% of fixed-odds sports betting turnover and 5% of gross profit (being gross revenue minus dividends paid, but not less than zero) from fixed-odds sports betting; and
(e)all costs, charges, and expenses incurred by the Board in the exercise and performance of its functions, duties, and powers during that year in relation to sports betting.
(2) The surplus, if any, of the amounts received by it for sports betting that remains after making the payments referred to in subsection (1) must be applied by the Board in accordance with sections 15 to 17.

 

 

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We estimate this initiative alone will increase returns to the industry by $17 million – $19 million in annualised profit, rising to approximately a $30 million increase in net betting profit as a result of the Fixed Odds Betting change from 2021/22,” says Allen

Interesting to note the CEO states new betting initiative alone will increase returns to the industry by $17 - $19 million but now blaming that the current spiral downturn in revenue is due to no fees  on races from overseas. 

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New Zealand Racing Board head John Allen has hit out at claims international financial agency Deloitte have made about future TAB profitability.

A summary of the document known in horse racing circles as "The Deloitte Report" was circulated to thoroughbred clubs and industry organisations earlier this month.

The report, dated May 2017, was commissioned by NZ Thoroughbred Racing (NZTR) to investigate the NZ Racing Board's blueprint for the future. Until the release of the summary none of the report's findings had seen daylight.

The report's summary showed that Deloitte were critical of the NZRB's inability to secure or enhance its future.

It was also critical of the anticipated rate of return for the NZRB, which runs the TAB, from its soon to be unveiled fixed odds platform.

The platform, which is set to be rolled out on August 1, is a collaborative project with overseas companies Paddypower Betfair and OpenBet and is estimated to cost $59 million to $72m.

The margins the platform would return to the NZRB have been tested by financial firm KPMG, but Deloitte were critical of the strength of that testing in its report summary.

NZRB chief executive John Allen is at odds with that criticism and is critical of Deloitte for not doing enough research into the fixed odds platform (well that call came back to bite him in the proverbial).

"Deloitte didn't talk to us, this was a desktop exercise that they undertook without actually engaging with us and in our view they have significantly understated the value we are going to create from this. Because they have made assumption about the way in which our calculations were reached which are simply not true." Allen is more than comfortable that NZRB made the right choice in partnering with Paddypower OpenBet and that the partnership will increase his organisation's profitability.

 

It's obvious now who did better the better business calculations and who understated the value of the bet platform.

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Lights Out you bring up an interesting point.

i.e. All costs including the annual Paddy power fee must be set against Sports Betting profits and not racing. If need be Racing can dump all US, JAPAN, FRENCH, Korean, South African and UK jumps racing if it means paying an unrealistic fee.

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This is where we have a problem and was one of the reasons a few of us turned up at the Select Committe to voice our displeasure. Needless to say no-one listened to us

  (i)not less than 5% of totalisator sports betting turnover; and
   (ii)not less than 1% of fixed-odds sports betting turnover and 5% of gross profit (being gross revenue minus dividends paid, but not less than zero) from fixed-odds sports betting; 

Not less means this is the minimum. Opened the gate to be more

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9 hours ago, Patiti said:

Rugby and soccer pools withdrawn as well.

Any idea why? From what I gather the rugby pools was fairly well supported particularly when the jackpot got up a bit. 

 

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