Ask PN - October 2011

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Evening Princess. I have seen that betting on horse racing is a diminishing % of Bookmakers' overall turnover. Do you know what % this is (currently) of total horse racing betting turnover in this country? Also can turnover be broken down into the following?:

  • on course bookmakers
  • off course bookmakers
  • exchanges
  • Tote on course
  • Tote off course

I've also heard that some bookmakers have off shore outlets to avoid tax. Is this true and, if so, how does their turnover figure in the grand scale of things?
 
Ah, the $64million dollar question Ron!

I've got some figures in work that might help answer, so I'll dig them out in the morning.
 
I’ve had a look at the figures I have, and unfortunately they are not as accurate as I had hoped. Bookies have often claimed that horseracing is in decline as a betting medium, but if you suggest that we move to a Tote monopoly they sure do make a lot of noise!

The IFHA website has very interesting figures for wagering in each major racing nation. It is probably worth a look. Just try not to let your jaw hit the floor when you see the figures from Hong Kong – it makes UK betting look like child’s play! http://www.horseracingintfed.com/wageringDisplay.asp?section=4

The key thing for racing is that The Levy is currently calculated according to Gross Profits, rather than actual turnover. I believe the figure taken is 10% of gross profits. However, this allows bookmakers to fudge around with their figures as, when trading offshore, their profits are not counted as having been produced in this country and therefore are not liable for levy. I think I am right in saying that all the major bookmakers have moved their internet and telephone betting operations “offshore” so any bets placed in this way are exempt under current legislation.

There are moves afoot to try and update the legislation so that betting exchanges (which were pretty much unheard of when the rules were written in 1999) are brought into line and that the offshore loopholes are closed.
 
Thanks Princess. Any idea how much difference that might make?
 
I was waiting for PNs response to your question Ron with interest.
On another thread I mentioned that I had researched 'crossing over' to becoming a bookie and the figures some of the leading independents were giving me were scary, up to 90% of their turnover has disappeared since the inception of exchanges, add that to the courses failure to recognise pitches beyond 2012 and the subsequent review of contribution on course bookies make to attend, the industry is heading towards a crossroads.
I also stood at some courses for experience, there were days when the pitch I represented was one of only 10 bookies (rails and tatts) present, and there were races we took less than £100 a race.
I can't access anything from the office but if you go to betfair just before the off on one of todays Newmarket races you'll see turnover of hundreds of thousands, the ring will see a fraction of that.
 
The talk is that if the new systems were in place for this year, racing would be seeing a Levy of around £80-90million, instead of the pitiful £60million that is expected.
 
PrincessNewmarket said:
The talk is that if the new systems were in place for this year, racing would be seeing a Levy of around £80-90million, instead of the pitiful £60million that is expected.
Click to expand...

This would be because the exchanges would be making a contribution that reflects their turnover/profits from racing right ?
 
Grizzly, it was your post that prompted mine.
Actually, I almost became a bookmaker (not a lot of people know that). I started my career in a local life assurance company, initially administering companies' pension and life assurance schemes before moving on to the preparation of policies, trust deed & Rules. Somewhere in that period I went for an interview with William Hill and was about to take the job, but moving from a reputable life assurance company to a bookmaker brought my mother (bless her) to tears. So I stayed where I was. Never regretted it though because I moved into the IT department and there I remained until retirement.

Princess, at some point you reported the contribution from the betting industries in UK and France and there was a remarkable difference in absolute amounts, but how does that compare as a % of turnover and also in the context of number of racehorses, venues and meetings?
 
Ron - a career in life insurance is more respectable than bookmaking ?
:emoticon-0100-smile

I think we would all prefer to work in an industry where we have a passion but sadly the industry pays poorly and relies on the passion of its' people, but on course bookmaking was for me the next best thing, it was something I understood and I had all these plans to sponsor racing charities and change the image of bookmaking, a year of research and I realised how tough these guys are likely to face life in a years time.
Ascot 16 times highest admission ?
So a bookie with pitch no' 150 who stands a mile from the main ring has to lay out what, £900 a day just to plug his board in ?
Throw in travel costs, staff costs etc and he's £1500 down before he starts taking a fraction of the bets he was a few years ago ?
Whilst I was very keen to improve the lifestyle and stand every day possible, there are still bills to pay and the industry I think will change dramatically soon...
 
The French figures you refer to were the first-half 2011 results for the PMU as reported here: http://www.thoroughbredtimes.com/national-news/2011/07/12/frances-pmu-enjoys-strong-first-half-of-2011.aspx

As for comparions, the answers can be found on the IFHA website (the figures look rather large to me, but I'm taking them as read)

France 2010

6,988 races run
14,960 horses raced at least once

Betting turnover €9,502,340,889


GB 2010

9,556 races run
19,242 horses ran at least once

Betting turnover €7,660,315,740

Compared to Hong Kong

767 races
1,230 horses ran at least once

Betting turnover €7,702,400,000
 
Quite right Janabelle. All bar the first 6 years of my career were in IT. I think some people just think of direct selling when they hear life assurance. Our company didn't get involved in direct selling until it took over a direct sales company. From my viewpoint it just made the IT a bit more interesting.
 
I was following up on Grizzly's post. I did work for William Hill for a couple of years as a boardman. Couldn't take the ***s.
 
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