Racing Board moves to reduce impact of recession

17 July 2009
Media Release
 
New Zealand Racing Board moves to reduce impact of recession
 
In light of the current economic environment, the New Zealand Racing Board has moved to reduce costs to minimise the impact of the recession on the racing industry.
 
As part of this process, the NZ Racing Board has reviewed its Commission Fee Structure for some hotels and clubs with TAB facilities.
 
NZ Racing Board Chief Executive Andrew Brown said there had been a significant decline in betting revenues over the last year.
 
“Along with many other New Zealand businesses, we are experiencing a reduction in revenues as a result of the current economic environment”, Mr Brown said.
 
Mr Brown, who started as Chief Executive two months ago and is the former Chief Operating Officer of Racecourse Media Group in the UK, said the organisation had been reviewing all its costs to ensure the future sustainability of the business and the racing industry as a whole.
 
“The first step in this is that we need to make is an adjustment to our Commission Fee Structure for hotels and clubs with TAB facilities.”
 
The change to the Commission Fee Structure will affect only 113 of the total 397 hotels and clubs with TAB facilities around New Zealand.
 
“The last major review was done about five years ago, and since that time both our business and market conditions have changed significantly,” Mr Brown said.
 
The number of races the NZ Racing Board has offered betting on has almost doubled from about 17,000 in 2003 to 33,000 in 2009, which has provided hotels and clubs with higher turnover and therefore more commission.
 
“The review of the Commission Fee Structure means the base commission paid to each outlet affected will be reduced, however, the new structure also enables outlets to achieve an increase in commission through improved performance.”
 
Mr Brown said the changes to the Commission Fee Structure did not apply to stand-alone TAB stores.
 
The NZ Racing Board has consulted with industry representative groups around the change and has also written to those hotels and clubs affected advising them of the change.
 
NZ Racing Board Chairman Michael Stiassny announced in March this year that NZ Racing Board management had been charged with delivering cost savings of $10 million per annum.
 
These saving were to be implemented in the 2009/10 season to minimise the impact of the economic recession on the industry.
 
Mr Brown said he would be looking at all areas of the business to achieve the required cost savings.
 
Ends
 

© Scoop Media