Scotia meets Ken Rutherford re: improved communications

thanks for this Scotia, now don't rest too much on your laurels - can you get on to meeting with Rian D P and ask him about his strategy for racing please...especially after the GC meeting of this past week...not good. In fact, skip asking him about his strategy, tell him we want ANSWERS.

at least Ken is acknowledging the HORSE is the key to his market...we have a breakthrough here! coffeeeeee

at least Ken is acknowledging the HORSE is the key to his market...we have a breakthrough here! coffeeeeee

bloody hell that was worth repeating.

Here is a copy of the Presentation that Rian Du Plessis gave to the Gambling Board National Gambling Conference presentation

ps you might need to use Skydrive to read

any way you can email it to me please? much appreciated

@don:

the NGB has never ever invited any non-kosher punter/owner to address them. The speakers are hand-picked (free hotel accommodation, air fare et al), and submitted by the industry to the NGB.

The only time we heard of oppostiion to corporatisation was during the Asian Racing Conference held at Sun City.

That guest (a retired general or something from England or Australia) was never heard of again despite presenting potent arguments against corporatisation; what he foretold then, is reality today......racing in a rut!!!!

The downward spiral will accelerate within the next year or two, until there is total implosion.

Don't believe me.... all those skeptics out there?

We are also seeing a repeat perfomance of the sinister strategy when the Randjiesfontein track was built and offered to Province; the owners sent horses to a number of trainers to get their 'ayes' for Province to purchase the track!

What different is happening today? One or two monied patrons (who also hold direct and indirect interest within the entire industry, including control and regulation), dishing out horses left and right!

Instead of Malema wailing, genuinely concerned horseracing enthusiasts should be petitioning the Goverenment for an investigation into this industry.... right from corporatisation......asset stripping, absence of transformation (as in the MOU), inconsistent control & regulation, non-accountability, nepotism, etc.....

What the heck.... who cares?

Don and many others, tried a copy paste and was going strong until I hit the tables..............sorry, but you get the content?

Horseracing and Betting

Can it compete with other gambling industry role players in this age of technological advancements


-OVERVIEW
-PHUMELELA GAMING & LEISURE
-GOLD CIRCLE
-HORSERACING
-TOTALISATOR
-SOCIO-ECONOMIC IMPACT
-CHALLENGES & THREATS


Horseracing is one of South Africa’s oldest sports, having been introduced during 1797.
We have a rich history of top quality thoroughbreds, trainers and jockeys who have competed in premier racing events that attract not only horseracing enthusiasts and punters, but socialites keen to be part of the excitement and spectacle of the race day.
South African racing attracts a widely divergent market of over 2.2 million punters annually.
436 race meetings are staged nationally each year and the sport enjoys more than 4,000 hours of local television coverage.
SA racing is broadcast to more than 40 countries 364 days a year, thus giving South Africa as a country significant exposure.

Horseracing is probably the least known
but most effective form of advertising South Africa
as a tourist destination!


Established in October 1997 at the instance of the Gauteng MEC for finance and listed on the JSE in June 2002
Shareholders the Trust (35%), 10 BBBEE Groups (26%), employees and public
7 Trustees, 5 nominated by RA (owners) and 2 by Sascoc
Underwent massive restructuring following legalisation of other forms of gambling (Casino’s and National Lottery)
PGL is licensed to operate horseracing in Eastern Cape, Free State, Gauteng & Northern Cape


PGL licensed to operate the totalisator in Eastern Cape, Free State, Gauteng, Limpopo, Mpumalanga, Northern Cape & North West
Gold Circle is licensed to operate horseracing and betting in KwaZulu-Natal and Western Cape
Gold Circle is a Section 21 Company, not for profit


4th Most popular sport in South Africa (3rd most popular sport in the world!)
PGL and GC stage horseracing meetings and pay prize money
10 racecourses & and numerous training centres
Stage 436 race meetings annually
Turf and sand tracks
Investigating synthetic tracks


National Horseracing Authority (NHA) regulates horseracing
Sport is predominantly funded by horse owners & totalisator
Only sport licensed by Gambling Regulators
Only major sport that pays for television airtime
Only Gambling or Betting business that pays for its own regulator
Earns very little portion of corporate SA’s sport sponsorships

Horse owners made a net contribution of R574m to the industry and punters a R1.74bn contribution in 2009
This is 25% and 75% respectively of the overall contribution to the industry and resulted in a total industry size of R2.3bn.
When the multiplier effects are taken into consideration the industry makes a R2.71bn contribution to GDP


London News – Hong Kong QEII cup (1997)
Trademark – USA Bernard Baruch Handicap (2003)
Crimson Palace – USA Beverley D Stakes (2004)
Victory Moon – Dubai World Cup (2004) The world’s richest race!!
Perfect Promise – Australia Emancipation Stakes (2005)
Irridescence – Hong Kong QEII cup (2006)
Jay Peg – Dubai Duty Free $5 million (2008)
Sun Classique – Dubai Sheema Classic $5million (2008)
Lizards Desire – Singapore Airlines Cup & second in Dubai World Cup (2010)
Gypsys Warning – USA Matriarch Stakes (2010)
JJ The Jet Plane – Hong Kong Sprint & Dubai Al Quoz Sprint (2010)

Michael (Muis) Roberts – UK Champion Jockey (1992)
Bartie Leisher – Hong Kong Champion Jockey (1988)
Basil Marcus – 7 time Hong Kong Champion Jockey (1992-1999)
Dougie Whyte – 10 time Hong Kong Champion Jockey (2001-2010)
SA jockeys have also won:
The Mauritian Jockeys Championship 10 times
The Singapore Jockeys Championship twice
The Macau Jockeys Championship twice
NOTE: Michael Roberts accomplished a historical feat in winning the British Jockeys Championship – he is one of very few foreign jockeys to have done so. The Hong Kong Jockeys Championship is one of the most hotly disputed jockeys’ championships in the world.


Mike de Kock
Major race winners Dubai, England, Singapore, USA
Leading international trainer at Dubai World Cup
$5-million Dubai Sheema Classic (2008), $5-million Dubai Duty Free (2003 & 2004), $2-million UAE Derby (2003, 2004, 2007, 2008 & 2010)
Patrick Shaw
Top 5 Singapore Trainers Championship since 2007
David Payne
Leading trainer Australia

David Ferraris, Tony Millard
Leading trainers Hong Kong

Betting in South Africa has an annual turnover of approximately R 7 billion
Horseracing has approximately 10.3 % market share of the greater gambling industry
Totalisator betting represents 4.5%
Betting is NOT gambling! It is a game of skill!
With Totalisator betting the house has no interest in the outcome. The bet is essentially punter vs punter with the House taking a % of the pool.
Fixed odds betting is punter vs bookmaker and the bookmaker has a vested interest in the outcome of the bet

Totalisator betting is the least of all
Gambling and Betting evils!

PGL Operates Totalisator betting in Eastern Cape, Free State, Gauteng, Limpopo, Mpumalanga, Northern Cape & North West

Betting on mainly Horseracing & Soccer
Soccer Betting Now 10% of Betting Turnover
Soon to introduce betting on other sports
Over 400 betting shops (TAB branch & agency network)
National lottery has around 7 000 outlets
3 Call Centres - Eastern Cape, Gauteng & Western Cape

Totalisator betting has been in decline globally and also in South Africa since the introduction of other forms of gambling and betting on other sports
Phumelela’s headline earnings declined 20% in 2009 FY and by a further 16% in the year ended 31 July 2010
Phumelela’s results for the 6 months ended 31 January 2011 show a further 9% decline
Gold Circle lost R21 million in 2009 and R13 million in 2010


There are 2.2 million adults in South Africa who are interested in horseracing and 1.5 million regular punters with the following profile:
82% Black
62% Male
60% are between the ages of 18 - 34 years
50% of punters are LSM 6 - 7
Concentrated mostly in Gauteng, followed by KZN, Free State and Western Cape
Although totalisator betting operations (including horseracing) account for less than 5% market share, it is responsible for thousands of jobs in the industry, directly & indirectly
Supports many more jobs in allied industries, including farming/breeding, transport, textile, media, horticulture, veterinary services, steel and paper, etc.
11 662 direct and indirect jobs (2009)

In 2009 the Casino industry employed 0,289 people for each million Rand of gross gaming revenue vs horseracing’s 6,77

Contributed R2.71bn to Gross Domestic Product in 2009
Contributed a cumulative R16.8bn to Gross Domestic Product Between 2002 and 2009
R694m is generated in the form of direct and indirect taxes
28% was paid to provincial governments and 72% to the national government


R274m goes to the breeding industry. This is 12% of the industry. The breeding industry in turn contributes R368m to GDP (13.6% of the total) and sustains 3 337 direct and indirect jobs (21.3% of the total).
R544m goes to the training industry. This is 23% of the industry. The training industry contributes R764m to GDP (28.2% of the total) and sustains 4 245 direct and indirect jobs (27.0% of the total).
R337m goes to bookmaking industry. This is 15% of the industry. Bookmakers in turn contribute R330m to GDP (12.2% of the total) and sustain 1 957 direct and indirect jobs (12.5% of the total).

R1.16bn goes to the racing operators Phumelela and Gold Circle. This is 50% of the industry. The operators contribute R1.25bn to GDP (46.0% of the total3) and sustain 5 189 direct and indirect jobs (33.1% of the total)
This makes a total R1 245m contribution to GDP. A closer examination of the operators reveals that:
R229m goes to provincial taxes and VAT (19.7% of operators revenue)
The running of the betting operations contributed R620m to GDP

üThe upkeep and running of racecourses and training facilities contributed R372m to GDP
üJockey remuneration makes a R66m contribution to GDP


Phumelela and Gold Circle have made strides in their transformation and BBBEE initiatives
Phumelela has a level 3 contributor rating (Empowerdex AA BBBEE level), with 57.32% black ownership and is working on achieving level 2 contributor rating by 2015
Gold Circle has a level 4 contributor rating (Empowerdex A BBBEE level)
Phumelela’s Corporate Social Investment initiatives include:
SuperSport Soccer Academy
SAPS Mounted Unit
South African Responsible Gambling Foundation
Food Tents & Feeding for Local Schools
SOJO (South Johannesburg Development)

Gold Circle’s Corporate Social Investment initiatives include:
Charity race meetings
Funding the Racing & Equestrian Academy
Funding National Grooms School


Sport of horseracing is facing a financial crisis locally and internationally
Totalisator betting (17 bet types) struggles to compete with fixed odds betting (unlimited bet types)
Bookmakers can offer Tote betting (“Open Bet”) but the Tote cannot offer fixed odds
Playing fields are not level
Punters pay 6% tax on horseracing winning bets and zero on other sports
Disproportionate contribution to horseracing by the Tote
Bookmakers took 46% of all gross gaming revenues in horseracing in 2009, but returned just 18.1% to horseracing through punters’ tax on winning bets
Totalisator operators return 42.4% of gross gaming revenues to horseracing.
Phumelela and Gold Circle took in R1.2bn in gross gaming revenues and returned R607m to the sport while the bookmakers took R411m and returned R75m in 2009.
If bookmakers were subject to the same regime as totalisator operators, then a further R100m would have been returned to the sport in 2009

Inconsistent and fragmented regulatory environment
§This increases the costs of compliance and results in economic inefficiencies
§Different and onerous provincial licensing requirements, conditions of license, license durations, licensing processes, interpretations of rules and standards
§National lottery is regulated on a national basis but the Tote is not!
§Provincial Gambling Boards have different standards and tax rates for the Tote (not for bookmakers!!)



Gauteng 6.5% on Takeout Turnover = 1.55%
Mpumalanga 2.5% on Turnover Takeout = 10.25%
Limpopo 3.5% on Turnover Takeout = 14.32%
North West 6.5% on Takeout Turnover = 1.58%
Eastern Cape 10% on Takeout Turnover = 2.40%
Northern Cape 8 % on Takeout Turnover = 1.93%
Free State 3 % on Turnover Takeout = 12.37%
KwaZulu Natal 1.5% on Turnover Takeout = 6.5%
Western Cape 6% on Takeout

Turnover = 1.42%

South African horseracing is facing an uncertain future
The number of registered breeders of thoroughbreds decreased from 925 in 1998 to 453 in 2008 (51% decline)
The number of trainers declined from 204 in 1998 to 187 in 2005 reaching a low of 170 in 2009 (8% decline)
The number of jockeys fell from 164 in 1998 reaching a low of 81 in 2008 (51% decline)
South African horseracing is facing an uncertain future
The number of registered breeders of thoroughbreds decreased from 925 in 1998 to 453 in 2008 (51% decline)
The number of trainers declined from 204 in 1998 to 187 in 2005 reaching a low of 170 in 2009 (8% decline)
The number of jockeys fell from 164 in 1998 reaching a low of 81 in 2008 (51% decline)
Similar trends are evident in the number of races and race meetings that are staged, the number of registered racehorses and the number of starters that have run in these races
In 1998 there were 487 race meetings, 4 178 races, 7 377 registered racehorses and 49 310 starters taking part in these races
By 2009 there were 436 race meetings, 3 820 races, 6 455 registered racehorses and 42 103 starters
These are decreases of 10.5%, 8.6%, 12.5% and 14.7% respectively
Use of technology will materially reduce the cost of taking a punter’s bet
Technology takes the bet to the people instead of the people having to travel to place a bet
Best medium will be telephone betting, followed by internet betting
Removal of exchange controls will drive betting offshore to avoid taxes
New withholding tax will drive punters away from the Tote to the Bookmakers
Online casino licences will take further revenue away from betting on horseracing
Use of technology will materially reduce the cost of taking a punter’s bet
Technology takes the bet to the people instead of the people having to travel to place a bet
Best medium will be telephone betting, followed by internet betting
Removal of exchange controls will drive betting offshore to avoid taxes
New withholding tax will drive punters away from the Tote to the Bookmakers
Online casino licences will take further revenue away from betting on horseracing

Use of technology will materially reduce the cost of taking a punter’s bet
Technology takes the bet to the people instead of the people having to travel to place a bet
Best medium will be telephone betting, followed by internet betting
Removal of exchange controls will drive betting offshore to avoid taxes
New withholding tax will drive punters away from the Tote to the Bookmakers
Online casino licences will take further revenue away from betting on horseracing


The Sport of Horseracing needs additional
funding and regulatory protection and
intervention is needed
NOW!

I actually find it quite funny how he ends his presentation

His ending says it all actually."We have mismanaged the situation but maintained our balance sheet by asset stripping.That strategy has come to an end as there are few assets left,but we are clueless as to how to go forward and need someone who knows what they doing to help."
Many many posts on this site predicting that,long before his assessment!

Thanks, will work my way through it Scotia. @Hibs, as if he has ever allowed intervention - there have been tries, meetings, suggestions, proposals, concerned people's pickets etc etc over the years....all squashed! @umlilo, even a round at gov to intervene a number of years back but you know how it goes - the fat cats know best and will just squash the wayward teenager's wails every time and so they perpetuate what is playing out now...there are a handful of men stifling progression and I will refrain here from naming them, some of them present at the Gold Circle meeting of the weekend where it was discussed how to wind up the business and assets of a dying business - the audacity!! still, they do not know that they are directly accountable for the state of today's affairs. I hope out of the ashes will rise a Phoenix of young, forward thinking leaders who will build racing to what it can and should be in SAF.
Excuse me gentlemen then whilst I make my way to Goodwood to go and watch something special happening today.

"Excuse me gentlemen then whilst I make my way to Goodwood to go and watch something special happening today".

Don green with envy............enjoy