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RITA ANNUAL REPORT

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The Racing Industry Transition Agency (RITA) today reported a Net Profit before distributions of $162.5 million (which included a government relief grant of $41 million) for the year ending 31 July 2020 in its final report prior to its transition to TAB New Zealand on 1 August.

TAB New Zealand (formerly RITA) Executive Chair, Dean McKenzie said the result reflected an extraordinary year for the business.

“The year is best described as a game of two halves, with the first six months showing an improvement on the same period the year. However the industry then faced one of the toughest financial times in its history, with racing and global sport almost coming to a complete standstill with the arrival of the COVID-19 pandemic and lockdowns.

“Despite the impact of COVID-19, RITA still was able to distribute $152.3 million to Racing and Sport, including $137.6 million to the racing codes, clubs, and racing integrity bodies. More than $14.7 million was returned to the sporting community over the course of the year.

“The impact of very limited racing and sport during the peak of the crisis can’t be understated and RITA was faced with some difficult decisions to keep the business sustainable, including the removal of 230 roles, which was around 30 percent of staff. A number of other changes were also made, including not resuming Trackside Radio or Phonebet, and changes to Trackside production and presentation with a reduced number of cameras on course and presenters continuing to mainly operate from the studio,” said McKenzie.

Total Turnover (Betting & Gaming) for the year of $2.6 billion was $141 million (-5 percent) below last year and $566 million below budget (-18 percent), while Gaming turnover was also impacted by COVID-19 with a decline of -10 percent to $461 million (-$52 million). Total Revenue, excluding the Government relief grant of $329 million was $19 million (-6 percent) below last year. Operating expenses declined year on year (saving $5 million or 4 percent against budget) which included a reduction of $7 million in staff expenses.

“Away from the operational performance of the TAB, the year was historic with new legislation to reform the industry passed into law securing complete support across Parliament. Having such a broad consensus on legislation is rare, and will almost certainly mean the underlying framework of the industry is sustainable and enduring. 

“As we look towards the future, TAB NZ is positive the foundations are now firmly in place for the industry to build on. We look forward to working with the new Minister to complete the reform programme, new regulations, the appointment of a new Board, new Chief Executive and the establishment of the Racing Integrity Board.” 

RITA was established by the Racing Reform Act 2019 to support the reform of the New Zealand racing industry before transitioning to TAB New Zealand on 1 August 2020 following the passing of the Racing Industry Act 2020. 

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With the period without local racing and then to return with limited meetings to get things going again be a reduction in meetings?? They said there was a 5% down turn in turnover below last year not bad I would think all things considered. A saving of 5 mill on operating expenses and 7 mill on staff expenses must be a plus though don't agree with all the changes they made with there being no promotion of racing through media etc. Least now we do have some more positive accountability in this over expensive operation.

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There is a turnaround now with wagering well up and expenses down. T/O to do with increased field sizes? These are caused by paying down to losers. I dont totally agree that is good for horse or owner welfare.Your $170 nett wont pay the float fees and shoes.

I think the last 2 in a race over 10 starters should not get the 200. What do you reckon?

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Obviously Covid has had an impact on the end result but the one positive it did do was to ensure financial and structural  changes were made. These types of changes made was why RITA was put in place halfway through last year. Nothing was done except bank loans increasing by $10 million prior to Covid when if they had got their act together it would have resulted in a slightly better financial end result. 

Interesting to note I didn't see it mentioned anywhere the financial impact of the 'bonus bets' fiasco which resulted in millions wrongly credited as income. $1.6 million of this was wrongly included in last years Financial Reports plus millions more this year. The $1.6 million should have got picked up by the Auditors last year but guess they didn't want to embarrass themselves by making mention of it.

In March RITA advised an independent review would be undertaken as this bonus error would impact on the Financial return to the Industry. Where is the findings of this 8 month old review? Surely it should have got included in the Financial Report just released and another reason why the end result is down? You can't hang it all on Covid. Then again they will probably blame Covid for giving the Platforms software a virus.

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TAB chairman Dean McKenzie told the Herald there is no hiding from the error but an independent review will be undertaken to discover exactly how it happened and who or what is at fault.

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The TAB has commissioned an independent review into a mammoth miscounting of its bonus bets promotions which is set to significantly affect the racing industry's returns this year.TAB staff and racing code bosses have been told of an error inside the new fixed odds betting platform (which runs the TAB betting website) which effectively meant bonus bets were being counted twice.

What do you think any Company would be doing if they paid $50,000,000 to another Company for a  Betting Platform (which you don't own) and you are paying millions a year for it to be serviced and maintained and then you put out a press release placing the reason for the reversing in millions in accounts was due to an error in its system. You would be seeking full monetary compensation for the loss as the betting platform wasn't maintained and serviced as needed so these type of errors don't occur.

If the loss isn't compensated in next years accounts then serious questions need to be asked eg if no compensation obviously it can't have being the Platform so how did it happen?

There are I think a number of other matters of concern in the Financial Report so it will be interesting to see what develops down the track.   

 

 

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On 11/29/2020 at 10:20 AM, LightsOut said:

Obviously Covid has had an impact on the end result but the one positive it did do was to ensure financial and structural  changes were made. These types of changes made was why RITA was put in place halfway through last year. Nothing was done except bank loans increasing by $10 million prior to Covid when if they had got their act together it would have resulted in a slightly better financial end result. 

Interesting to note I didn't see it mentioned anywhere the financial impact of the 'bonus bets' fiasco which resulted in millions wrongly credited as income. $1.6 million of this was wrongly included in last years Financial Reports plus millions more this year. The $1.6 million should have got picked up by the Auditors last year but guess they didn't want to embarrass themselves by making mention of it.

In March RITA advised an independent review would be undertaken as this bonus error would impact on the Financial return to the Industry. Where is the findings of this 8 month old review? Surely it should have got included in the Financial Report just released and another reason why the end result is down? You can't hang it all on Covid. Then again they will probably blame Covid for giving the Platforms software a virus.

What do you think any Company would be doing if they paid $50,000,000 to another Company for a  Betting Platform (which you don't own) and you are paying millions a year for it to be serviced and maintained and then you put out a press release placing the reason for the reversing in millions in accounts was due to an error in its system. You would be seeking full monetary compensation for the loss as the betting platform wasn't maintained and serviced as needed so these type of errors don't occur.

If the loss isn't compensated in next years accounts then serious questions need to be asked eg if no compensation obviously it can't have being the Platform so how did it happen?

There are I think a number of other matters of concern in the Financial Report so it will be interesting to see what develops down the track.   

 

 

If you go to  NZTAB and ask for board minutes for meetings July to September you should get your answers to the  questions you raise about bonus bet enquiry. If they don't want to pass them on then go to OIA and ask for them

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4 hours ago, JJ Flash said:

If you go to  NZTAB and ask for board minutes for meetings July to September you should get your answers to the  questions you raise about bonus bet enquiry. If they don't want to pass them on then go to OIA and ask for them

I've tried that for quarterly reports via the OIA but they redacted all financial information and frankly the ombudsman's office was next to useless in assisting.

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On 11/29/2020 at 10:20 AM, LightsOut said:

If the loss isn't compensated in next years accounts then serious questions need to be asked eg if no compensation obviously it can't have being the Platform so how did it happen?

Goofy Glenn and he is still there.

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41 minutes ago, Leggy said:

I've tried that for quarterly reports via the OIA but they redacted all financial information and frankly the ombudsman's office was next to useless in assisting.

Try NZTAB . Board minutes should tell all

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Goofy Glenn and he is still there.

He is leaving at the end of November which is a reason the Industry should be celebrating today.

Apparently going to work in Nevada for Don Best who offer trading and betting services. It was sold in 20-18 to Scientific Games a Company who also owns Openbet who built the NZ TAB betting platform and have a 10 year contract with the TAB for over $100 million to service and maintain the Betting Platform. This is the person who went overseas to source a new Betting Platform gave his recommendation to John Allen who passed it onto the Board. A $50 million dollar cost plus 10 years of tens of millions more. 

 

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The NZ TAB has three in-house lawyers employees with one on the new board,  if the contract with Openbet didn't have any conditions for recovery of money lost due to software problems they should all get sacked because the bottom line is no responsible Company lawyer would not allow that clause not to be included.

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I've tried that for quarterly reports via the OIA but they redacted all financial information and frankly the ombudsman's office was next to useless in assisting.

I could imagine the Ombudsmans office is often complete waste of time. Often its better to pass the info onto someone in opposition so questions can be directed to the relevant Minister for details and explanations. Someone I know is currently looking to do exactly that so maybe we will see down the track how good that process is in dealing with concerns relating to a Government entity.  

 

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On 11/28/2020 at 4:40 PM, Patiti said:

Should or have they returned the wage subsidy.

No they shouldn't have received it when they are saying Covid impacted by 10% which is obviously only a 1/3 of the threshold.

Take away the $4,000,000 in wage subsidy, the government bailout which included $28 million in months old accounts pre covid they can spin doctor until the cows come home they are in the $#^& big time. They are lucky the 150k max wage subsidy per company first proposed was lifted.

Messara had the right idea start with a clean piece of paper. More cleaning out is still required especially anyone associated with that crap piece of a thing they call a betting platform. The $17 million a year cost will ultimately sink the TAB.  

Will unfortunately be a laugh when the spin doctoring gets thrown at the Industry at the AGM. I thought Dean McKenzie would he an asset even though a few mates said different unfortunately I have to put my hand up and say I was wrong.  

 

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21 hours ago, LightsOut said:

I thought Dean McKenzie would he an asset even though a few mates said different unfortunately I have to put my hand up and say I was wrong.  

So you and your mates think DM is worse than John Allen and Glenda. Or might you accept that DM and the new board inherited a nightmare which coupled with Covid required capital injection to sustain operations. In the case of the web deal surely there was nothing they could do as money had been spent and ongoing contracts signed by the previous nutters

I think everyone needs to wait for this seasons results be it quarter or half yearly to see what new team have produced in terms of the restructured business and subsequent financial outcomes.

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