Racing and sport in New Zealand are set to receive a 20% rise in contributions from TAB NZ thanks to a surge in betting activity during the most recent fiscal year.
This comes after TAB NZ, which has a statutory monopoly over the betting industry in New Zealand, published its performance figures for the month of May.
The figures revealed gross betting revenue, turnover and net betting revenue were all above budget for the month.
TAB to increase contributions
In a statement, the operator explained that next year the three racing codes, New Zealand Thoroughbred Racing (NZTR), Harness Racing New Zealand (HRNZ), and Greyhound Racing New Zealand (GRNZ), are set to receive $23m more in fixed distributions compared to the budgeted amount for the current financial year, for a total of $140m.
According to the announcement, this increase equates to a 20% rise in growth year-on year.
The operator said that total distributions to sports are also expected to increase and set a provisional projected total of $19.7m for the next financial year.
This marks a 23% or $3.6m increase on the budget for the current year. However, this is subject to the regulations that will determine sport distributions being finalised
In its statement, the operator explained that “a number of factors have contributed to the TAB being able to provide this projected boost in distributions. These include strong financial performance across the current financial year, disciplined cost management on the back of a change in organisational direction and restructuring in 2020, and revenue uplift from improved margin performance and increased product availability.”
Speaking on the increased contributions, TAB’s Chief Transition Officer, Dean McKenzie said: “It’s great that we’re in a position to increase our returns to the community in the next financial year.
“Last year was a challenge for all of us and like many, our organisation went through a lot of change, but we’re now seeing the positive returns from the investment made by the Government and the industry in the TAB.
We’re excited with where we are heading and incredibly proud that significant tangible benefits from all the hard work over the last two or three years are now starting to flow to both racing and sport in New Zealand.”
TAB NZ’s May performance
Last week, TAB NZ provided its monthly trading update for May 2021, reporting strong performance from the operator.
TAB’s turnover in May amounted to $211.3m and was $16.5m above budget and $85.6m above last year’s figure.
According to the report, the strong performance against budget was driven by sport and assisted by the number of major sporting events being broadcast globally.
Total gross betting revenue was $33.9m, $3.2m above budget and at a margin of 16%.
TAB’s normalised profit for the month was $13.9m, which was $2.7m above budget. Normalised operating expenses were $9.9m for the month.
For the year to date, the reported profit is $147.2m, which is $37.5m above budget. Normalised Profit is $145.4m, which is $35.7m above budget.