Punters place nearly $1 billion at TAB
A six-year high in domestic sports betting at the TAB and an increase in active accounts offset falling customer numbers as punters spent nearly $1 billion in the six months to February.
The New Zealand Racing Board, which was established under the Racing Act to run the TAB in New Zealand, posted an interim net profit before distributions of $72.6 million.
This was down 1.1 per cent on the six months to January 31, 2013, though turnover had jumped to $1.05b, up 2 per cent.
Spending at the TAB ran away to a record $1.957b for the year ended July 31, 2013 - roughly equivalent to 1 per cent of New Zealand's gross domestic product.
Betting turnover for the first half of the latest financial year was up 2.8 per cent to $934.5m, riding on a 4.3 per cent increase in turnover from New Zealand-based customers, the highest rate of growth for at least six years.
Chief executive Chris Bayliss said the underlying business was performing well, but the focus was on monitoring costs while implementing new projects.
"It has been a challenging six months, as has been noted by other New Zealand operators in both the entertainment and retail sectors.
"The second half of our financial year will prove equally challenging."
The board, which wanted to be the best entertainment business in the country, was in the process of upgrading and improving an industry which had lost half its active punters in the past decade and was riding on systems that are like "a 20-year-old car".
This included the launch of a mobile app, as well as the introduction of new betting types and live streaming of events.
The Triple Trio bet type, which launched in mid-January, has paid out $2.4m in winnings, with two customers winning more than $300,000.
Bayliss said sales from other racing tote products had lifted noticeably since the launch.
"The trend of TAB customer numbers declining over the past decade has been counterbalanced by a 7.1 per cent increase in active accounts in the past year, as customers embrace our digital offering," he said.
A Watch&Bet live stream of Trackside was launched in December last year, while the board also announced TAB TV would be available online, as of today.
"It is crucial we remain focused and committed to working together as an industry to increase returns to New Zealand racing and sports," Bayliss said.
The board returns over 80 cents in every dollar spent at the TAB to customers, with the balance distributed to the racing industry and National Sporting Organisations through sports' sponsorships.
While betting turnover had increased, gaming revenue declined 3.7 per cent to $119.4m.
This was largely due to the closure of Wellington's Courtenay Place TAB as a result of the earthquakes last year, the board said.
Furthermore, foreign exchange rates led to lower returns from Australians betting in New Zealand.