GREYHOUND RACING NSW ANNUAL REPORT ANNUAL REPORT

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1 GREYHOUND RACING NSW ANNUAL REPORT ANNUAL REPORT

2 WHO IS GRNSW? Greyhound Racing NSW (GRNSW) is a body corporate charged with providing strategic direction and leadership in the development, integrity and welfare of greyhound racing in New South Wales (NSW). It is the peak body of the sport and is responsible for ensuring the competitiveness and longterm commercial viability of greyhound racing for the benefit of participants, business partners and the community. From July 2009, GRNSW became responsible for the regulatory affairs of the sport. This broadening of responsibilities was the result of a government decision to transfer the greyhound division functions of the Greyhound and Harness Racing Regulatory Authority (GHRRA) to GRNSW. The business structure of GRNSW covers both the commercial and regulatory responsibilities with four core business units: Racing & Integrity, Industry & Strategy, Public Relations & Digital and Growth & Sustainability. Flowing from the legislative amendments to the Greyhound Racing Act 2009, the industry representative Board of GRNSW was replaced by an independent Board in February The amendments make a person ineligible for appointment if they are an employee of a greyhound racing club or member of the governing body of a greyhound racing club. Each Board member has a maximum tenure of eight years. The new members of the independent GRNSW Board were chosen by an independent selection panel comprising Michael Foggo (Convenor), Professor Percy Allan AM and Richard Zammit, and were assisted by probity adviser Rory O Connor, from governance firm O Connor Marsden. Our Vision To be Australia s premier supplier of greyhound racing, delivering an attractive and innovative wagering product, and focused on long-term sustainable growth that will drive increased prizemoney returns to participants and appeal to consumers. Core Values Our vision is based upon the following core values: Innovation Integrity Teamwork Professionalism Performance driven Customer focus Chasing 2020 GRNSW s strategic plan, Chasing 2020, was released in July The plan provides stakeholders with an understanding of how GRNSW intends to grow and position the sport into the future. Chasing 2020 outlines a shared vision and set of goals that will ensure greyhound racing in NSW continues to prosper into the future. Produced by the previous GRNSW Board, the forward-thinking document includes five pillars of strategic focus: Growth Image Racing Sustainability Governance Each pillar outlines strategies that will provide a range of benefits to all stakeholder groups. Chasing 2020 is supported by a standalone operational plan that is monitored on a quarterly basis and reported to the public yearly as part of GRNSW s Annual Report. This year s progress report on strategies and projects from the plan can be found on pages 22 and 23. IFC

3 2011/12 AT A GLANCE July - GRNSW announces the establishment of its own Greyhound Welfare and Veterinary Services Unit which sees GRNSW assume responsibility for the provision of oncourse veterinarians at all TAB meetings. August - As part of major changes to the identification of greyhounds, GRNSW begins the process of microchipping greyhounds retrospectively. Over the next three months, 4,000 greyhounds would be microchipped retrospectively at no cost to members of the sport. September - GRNSW implements world class regulatory reform overhauling Race Day Integrity Services, delivering enhanced scrutiny of all races in the state with the introduction of a central control room at GRNSW s Head Office in Rhodes. October - The Greenhounds program is launched by GRNSW and the NSW Government. The program allows pet greyhounds to go muzzle free in public places and boosts the chances of former racing greyhounds being re-homed. November - NSW Minister for Racing George Souris announces the creation of an independent selection panel tasked with recommending candidates for the new independent GRNSW Board. December - GRNSW announces an industry leading change that creates an exemption for eye drops to be used for greyhounds affected by Pannus. January - The 2012 GRNSW Country Challenge kicks off in Wauchope. In a major change to the series, races will be held during the calendar year instead of the previous July- September schedule, providing greater choice to participants by reducing scheduling clashes. February - The industry representative Board hands over to a new independent Board. Eve McGregor is appointed as Chairman of the new Board, replacing Professor Percy Allan AM who held the role for nine years. March - NSW super stayer Zipping Lad is named the 2011 Betfair Greyhound of the Year. Long serving Casino Greyhound Club Secretary Don Waldron was awarded the Allen Wheeler Medal for his outstanding contribution to greyhound racing over four decades, while Richmond Race Club was named Club of the Year. April - Don t Knocka Him wins the 2012 Macro Meats Golden Easter Egg, the world s richest greyhound race. Western Australia superstar Miata also makes an appearance at Wentworth Park, winning the Group 1 Association Cup. May - GRNSW s 65 Roses campaign raises more than $40,000 for Cystic Fibrosis Australia and Cystic Fibrosis NSW throughout the month of May. The money was raised at special 65 Roses Race Meetings which were staged at each of the 35 greyhound racing tracks in NSW. June - Graham Gorrie is appointed to the position of Greyhound Racing Integrity Auditor. Index 2011/12 At a Glance 1 Chairman s Report 2 Chief Executive s Report 6 Summary of Financial Performance 10 Racing Review 12 Racing & Integrity 14 Growth & Sustainability 16 Industry & Strategy 18 Public Relations & Digital 20 Chasing The Board 24 Board Members Report 26 GRICG 28 Payments to Clubs 29 GIDF Activity 30 Club Statistics Summary 31 Statistics 32 Five Year Comparison 33 Financial Statements 34 1

4 Chairman s Report New Era I am pleased to deliver my first report as GRNSW Chairman. 2011/12 heralded a new era for GRNSW with a new independent Board replacing the industry representative Board in February are familiar with many of the issues the new Board may face in the future. With this vast experience and skill set I am confident this Board will be able to enact a robust plan to ensure the sport is sustainable, not just next year, but in the years to come. Strategic Direction The previous Board made a number of decisions that have ensured the growth of the NSW greyhound product. This includes increasing prizemoney significantly throughout their term and the introduction of TAB C racing to a number of tracks in NSW, including the new TAB venues of Dubbo, Grafton and Wagga Wagga. One of the most significant achievements of the former Board has been the successful development and implementation of the club Operating Standards and Guidelines that have resulted in higher levels of compliance and stronger operations, significantly improving the risk management, performance efficiency, safety and accountability of NSW greyhound racing clubs. That said, the sport still faces several challenges in the immediate future particularly when you consider the changing wagering environment and its direct impact on the funding model of the industry. It is this funding model that is central to the sport s ability to continue to grow and increase returns to participants into the future. However, it is becoming increasingly clear that the current model will not provide sustainable growth in the long term and it is imperative that GRNSW reconsiders its strategic direction to reflect the changing operating environment and challenges ahead. It was a great honour to be given the opportunity to serve on the Board and an even greater privilege to be appointed Chairman. I look forward to the opportunities that the role will present. I am supported in the role of Chairman by my four fellow Board members, all of whom bring a unique set of skills to the table. David Clarkson, who is the Board s Deputy Chairman, has a deep passion for the racing industry and strong financial management experience. George Bawtree is the former Chief Executive of GRNSW and has an extensive background with community and stakeholder relationships in the public sector. Murray Nicol comes from a club and wagering background. Joyce Alamango has extensive hands on experience within the sport both as a participant and an administrator. Murray and Joyce were also members of the former Board and therefore During 2012/13 the Board will face these realities head on and forge a new strategic direction for the sport. As part of this, we will need to confront the issues that currently hinder our ability to provide ongoing growth. We will also need to be open minded and willing to consider innovative solutions and ideas that may lie outside of the traditional boundaries of the sport. Goulburn Upgrade And Introduction Of Local TAB C Racing On 31 July 2012, I had the privilege of being on course to unveil Goulburn s new state-of-the-art facilities and witness the club s first ever TAB meeting. The upgrade to Goulburn s facilities, which include a worldclass kennel block and a new judge s tower, cost more than $900,000 and was achieved due to an unprecedented three- 2

5 way partnership between the NSW Government, Goulburn Mulwaree Council and GRNSW. The completion of the project means Goulburn is now a quality facility in a key regional area of NSW that stages weekly TAB meetings which are beamed live into living rooms across Australia and the world on Sky Racing. I thank both the NSW Government and in particular the Goulburn Mulwaree Council for backing the project. The council was a strong supporter of the upgrade ever since GRNSW first made a request for it to put forward a third of the funding. It is due to the council s commitment and cooperation that the new facilities were able to be completed on time and on budget. In the future, I hope that GRNSW can enter into similar arrangements with more local councils across the state to allow tracks to undergo vital upgrades to their infrastructure. More exciting times await Goulburn with the construction of a new Multi-Use Facility, which will provide outstanding amenities and comfort for racegoers as well as a multi-function area for wider community use. The construction of the new building is scheduled to commence in late 2012 at a cost of $5.7 million, with GRNSW contributing $300,000. In addition, GRNSW will continue to explore opportunities across the state to convert Non-TAB product to TAB status as part of our commitment to deliver increased returns to participants. Boosting Integrity Protecting the integrity of greyhound racing is at the heart of what GRNSW does, it is a core function of the organisation. Fundamental to our growth is the confidence the public places in the integrity of our racing. It is for this reason that GRNSW has invested significantly in improving its integrity services. A record number of swabs were taken in 2011/12 and this number will increase even further in the current financial year after GRNSW nearly doubled its swabbing budget. The increase in swabbing follows the implementation of an industry leading race day integrity model in September 2011, delivering enhanced scrutiny of all TAB races in the state. The changes saw the establishment of a control room at GRNSW s head office in Rhodes, which receives live feeds of the race broadcast footage and utilises video conferencing equipment to facilitate communication between the tracks and office in real time. This Australian-first approach to stewarding has allowed GRNSW to improve the oversight of greyhound racing in this state to unprecedented levels by making best use of technology. 3

6 Chairman s Report Another change saw the introduction of a Greyhound Welfare and Veterinary Services Unit at GRNSW, headed by one of Australia s most respected greyhound veterinarians, Dr Brian Daniel. The unit provides GRNSW with direct access to veterinary expertise and knowledge, ensuring animal welfare is considered during the development and implementation of all new policies, rules and procedures. In a further boost to integrity, GRNSW appointed Graham Gorrie to the position of Greyhound Racing Integrity Auditor. GRNSW is very fortunate to have Mr Gorrie in this role, as he has strong legal credentials and an extensive background in wagering and sport. With these reforms GRNSW can confidently say its integrity services are at the forefront of the wagering industry and we remain committed to driving and adopting best practice in this area. 65 Roses Campaign In May 2012 GRNSW staged its first ever 65 Roses campaign which raised money for Cystic Fibrosis Australia and Cystic Fibrosis NSW. As part of the campaign each of the 35 greyhound racing tracks in NSW staged their own 65 Roses Race Meeting in May. It was great to see all the clubs get behind the campaign and help raise money for such an important cause. This support ensured the campaign was a great success, with more than $40,000 raised, more than half of which was through the clubs ancillary activities conducted either during the 65 Roses Race Meetings or throughout the month of May. Initiatives such as the 65 Roses campaign show how generous the greyhound community is in NSW and I hope that the partnership between GRNSW and Cystic Fibrosis can continue for many years. Tributes May I acknowledge the Hon. George Souris, Minister for Tourism, Major Events, Hospitality and Racing, for his efforts and support since I took on the role as Chairman. On behalf of my fellow Board members I would also like to pay tribute to the management team and staff at GRNSW, which is ably led by GRNSW Chief Executive Brent Hogan. I would also like to sincerely thank former Greyhound Racing NSW Board members Bill Mangafas, Tom Green and Jack Primmer for their service to the greyhound racing industry in NSW. Each of these gentlemen made a significant contribution to the progress of greyhound racing as part of the Board and their experience and counsel has been of tremendous benefit to GRNSW over an extended period. I would finally like to thank my predecessor Professor Percy Allan AM, who was GRNSW Chairman for nine years. It is due to his professionalism and expertise that greyhound racing in NSW is so well positioned to tackle the challenges it faces in the coming years. 4

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8 ChIEF EXECUTIVE S REPORT 2012 brought certainty to the immediate funding model of the racing industry with the High Court of Australia validating the race fields legislation and confirming the right of controlling bodies to impose a fee on all wagering operators who bet on our respective races. From a GRNSW perspective, we have been collecting fees from all wagering operators and spending that money for the last three and half years. It is the money that we have collected from the race fields legislation that has allowed us to pay an additional $19 million in prizemoney throughout that period over and above what we could have afforded to pay if we were relying solely on TAB distributions. charge an individual wagering operator more than 1.5% of their turnover on our races. We will continue to talk with Government over the next 12 months seeking further reform in this area so that the NSW greyhound industry can enjoy the full fruits of its approach to race fields fees. National wagering sales growth on NSW greyhound racing for the full financial year was above market averages amounting to 5.3% ($50.5m) with sales reaching $1 billion for the first time. This was supported by national wagering revenue growth on NSW greyhound product of 7.7% ($10.9m) to $153 million. This growth was achieved in a relatively flat wagering market and with no increase in the amount of TAB race meetings conducted. Whilst the legal endorsement of the race fields legislation provided the industry with increased certainty, the traditional business model of the racing industry continues to be under immense pressure driven by changing consumer needs and technological advancements. Sports betting continues to develop a stranglehold on the younger demographic and sports betting turnover will grow exponentially should in play betting be permitted following the Federal Government s review of the Interactive Gambling Act. Added to that, media rights negotiations between thoroughbred aggregator TVN and SKY Channel have the ability to significantly disrupt the race wagering marketplace over the next 12 months. Media speculation has included non-financial demands by TVN to take control of the national schedule of race meetings and limit the coverage of greyhound racing a position clearly designed to counter the strong growth being achieved by our product. During the year, GRNSW introduced a series of reforms that have substantially changed our approach to race day integrity operations, the identification of greyhounds and continued to improve our animal welfare standards. Our approach to race fields to date, which is to levy wagering operators based on the revenue generated from betting on our product, has also allowed us to focus on growing greyhound racing in this state. In that period we have grown the number of TAB meetings being conducted with an additional 208 TAB meetings now part of our schedule. TAB racing at Wagga, Grafton and Dubbo would still be an aspiration today had we followed the path of the other two codes from a race fields perspective. From the start of the 2013 financial year, Goulburn started TAB racing and we also increased our charge to 15% of each operator s gross margin on our product. The current NSW race fields legislation is complicated by the existence of a cap on fees which does not presently allow us to From a race day operations perspective, we have established a control room at the Rhodes office that has live feeds of the race broadcast footage, surveillance footage from the kennel blocks and video conferencing equipment to flow between the tracks and the office in real time together with modern bet monitoring tools. This resulted in the split of current race day integrity functions and duties between a Steward at the track, and a senior Steward who oversees and controls the meeting from the control room. The modernisation of our approach to stewarding is designed to improve the oversight and efficiency of our racing by making best use of technology. It delivers an enhanced capacity to monitor betting trends leading up to a race and provides one central contact point for race day operational matters. Senior Stewards also have immediate access to a range of information sources 6

9 that simply cannot be replicated at the track, resulting in better informed and consistent decision making. Aside from the regulatory enhancements, the reforms have provided the sport with the technology infrastructure to stream, in real time, its race vision by its own means if that need or desire arose. The majority of broadcast rights are currently held by Sky Racing which, in its current form and ownership, has a great working relationship with our sport. The infrastructure however provides the flexibility to consider other opportunities if appropriate commercial arrangements cannot be reached in the future or if the distribution strategy of the broadcaster does not meet the objectives of the sport particularly in terms of online and international distribution. It also further strengthens our ability to expand the number of TAB meetings being conducted, from the existing venues, on an extremely efficient basis when compared to our competitors. The rise in the number of prohibited substance cases over the last year has been disappointing. Those who participate in a race, whether as owners, trainers or the like, are entitled to expect that all other dogs will run on a level playing field. Likewise, the public is entitled to expect that when they wager their money everyone will be competing on an equal basis. Part of our response to this is a doubling of the swabbing budget for the new financial year that will result in the number of samples being taken increasing from 2,764 to an estimated 6,750 in the new year, a rise of more than 150%. Our response however is not just simply to increase the rate of sampling with the following also underway: A review of drug detection activities in other greyhound racing jurisdictions and racing codes; A review of penalties imposed by GRNSW, benchmarked against other greyhound racing jurisdictions and racing codes; A review of best practice approaches to drug detection, including the policies and processes utilised in other sporting codes, with a focus on identifying alternative means of hearing positive swab cases, particularly around therapeutic substances; and The development of education resources to better assist participants to improve their knowledge on a range of matters relating to greyhound performance and health. Community attitudes and expectations continue to change and what was seen as acceptable practice 20 years ago is not accepted today. The live exports debate that occurred in Australia during the last 12 months has had a significant impact in a number of ways. It has pushed animal welfare issues away from the extremes and into the mainstream and it has showed 7

10 ChIEF EXECUTIVE S REPORT how governments can be forced to act when a community is outraged by an emotive issue. GRNSW is proud of the advancements we have made on the animal welfare front in recent times, ensuring that our practices meet modern community expectations. Included amongst the developments over the last 12 months are: The establishment of our Greyhound Welfare and Veterinary Services Unit within GRNSW to not only provide veterinary services at TAB meetings, but to provide research, policy and technical advice to GRNSW on all matters relating to the health and welfare of greyhounds; The launch of Greenhounds with the NSW Department of Local Government as a brand to facilitate and promote muzzle free greyhounds following their racing career. Since its launch in October 2011, over 100 Greenhounds have now been accredited; The expansion of our relationship with Corrective Services NSW and our Greyhounds as Pets Program across two sites and the development of ongoing plans to enhance the outcomes for both dogs and inmates; The first Code of Practice for Greyhounds in Training, ensuring minimum standards for all greyhounds in NSW, which is now the basis for all kennel inspections conducted by GRNSW; and A strong focus on education and training, including the commencement of formal training for persons associated with the industry and the development of protocols to educate and regulate the breeding and rearing sector. GRNSW is working with Greyhounds Australasia and the other State bodies to holistically ensure our approach to the welfare of greyhounds, including those that are exported to race internationally, meets best practice. We have also formed a close working relationship with the NSW RSPCA to not only improve outcomes for ex-racers, but to improve the regulatory monitoring of participants from an animal welfare perspective. Whilst sponsorship is largely the domain of the race clubs, GRNSW does have a number of sponsorship properties and events that it conducts throughout the year that are supported by a loyal group of sponsors and partners of GRNSW. These include our principal wagering partner tab.com.au who is the exclusive wagering partner of the Dogs TV, Betfair who is the official betting exchange of NSW greyhound racing as well as the naming rights sponsors of the Greyhound of the Year Awards and the Blue Paws Breeders and Owners Incentive Scheme, Sportingbet Australia who continues to support the Super Stayers series and K.S Black & Co who sponsors the Country Challenge Showdown. I thank these organisations for their ongoing support. May I acknowledge the contribution of the Hon. George Souris MP, Minister for Tourism, Major Events, Hospitality and Racing and his staff led by Chief of Staff Frank Marzic, who continue to support the development of the racing industry throughout the State. In February, long-term GRNSW Chairman Professor Percy Allan AM and fellow Board members Bill Mangafas, Jack Primmer and Tom Green retired from the Board of GRNSW. Each of these gentlemen have made a significant contribution to the progress of the sport as part of the Board and their experience and counsel has been a tremendous benefit to GRNSW over an extended period. In particular I would like to recognise, on a personal level, the support, advice and opportunities I have received from Percy during my term as Chief Executive whilst he led the Board. The new Board of GRNSW, ably led by Eve McGregor, brings tremendous skills and experience to GRNSW and is working towards establishing a clear strategic direction that takes accord of the challenging environment that faces the sport. In closing, I want to express my sincere thanks to all our management and staff led by Darren Simpson whose dedication and team spirit has underpinned our performance this year, notwithstanding significant internal change as GRNSW continued to evolve the way in which the regulatory affairs of the industry are managed. 8

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12 SUMMARY OF FINANCIAL PERFORMANCE The 2011/12 financial year was a unique one for GRNSW with a number of one-off events affecting both the final position and the presentation of the information. On the income side Product Fees received from Tabcorp increased by 2.4% on the previous year. This was a welcome turnaround following the 1.4% decline which was experienced in 2010/11. had been deferred pending the outcome of the High Court challenge against the Racefields Legislation. At the completion of the 2010/11 financial year GRNSW held $15,815,333 in deferred revenue. The completion of the case and the resultant settlement with Tabcorp allowed GRNSW to realise $6,913,157 of the previously deferred balance Income Product Fees 30,704,497 29,994,372 Racefield Information Use Fees 8,905,038 5,285,537 Deferred Revenue Realised 6,913,157 Operational Revenue 1,365,582 Interest & Other 621, ,667 Total Income 48,510,233 35,808,576 Expenditure Scheme of Distribution Payments to Clubs 27,124,349 26,389,285 Administration Expenses 7,363,540 5,237,369 Club Incentive Scheme 1,827,059 2,135,191 Industry Infrastructure 3,493,445 2,750,000 Industry Advancement Projects 986, ,000 Racefield / Wagering Expenses 98, ,262 NCA Loan Forgiven 2,100,000 - Other 455,857 73,099 Total Expenditure 43,449,428 37,926,206 Surplus / Deficit 5,060,805-2,117,630 However the improvement was not unexpected. 2011/12 saw TAB significantly increase its Fixed Odds offering, with markets available on many more race meetings, as well as the continued installation of the Trackside animated racing game in TAB retail outlets, pubs and clubs. GRNSW s share of the revenue generated from these areas is all captured in the Product Fees line item. Racefield Information Use Fee revenue increased markedly compared to the previous year. This figure was positively affected by the resolution to a dispute with Tabcorp regarding the payment of racefields fees, however if that impact is discounted revenue received through racefields fees was still up by just over 14% year-on-year. Without doubt the biggest impact to the financial position of GRNSW in 2011/12 was the realisation of revenue that During the protracted court proceedings the GRNSW Board had resolved to run the industry budget at a planned deficit, fully aware of the deferred revenue which was being accumulated. The realisation of part of these funds has now enabled the accumulated losses to be eradicated and for the industry s financial position to be returned to a positive one. A one-off expenditure item of note in 2011/12 was the loan to the NSW National Coursing Association (NCA) relating to the construction of The Gardens complex being forgiven. The $2.1 million loan was effectively used by GRNSW as part payment for a 70% share of the property in March The buyout guaranteed the future of The Gardens for the long term and was seen as imperative by the GRNSW Board to ensure that greyhound racing continued uninterrupted in the critical Hunter region. 10

13 Importantly for the industry the GRNSW Board was in a position to acquire the 70% share of The Gardens due to the availability of funds that had come about from the resolution to the High Court case. GRNSW and the NCA have now entered into long term arrangements which see the NCA assume dayto-day operational control of the venue, subject to their ongoing compliance with the requirements of all NSW race clubs If one-off abnormal items are removed from the figures for the 2011/12 financial year the surplus for the year is reduced to $397,151, which paints a far more realistic picture of operations for the year. A major development on the financial side of the organisation, which took effect on 1 July 2012, was the merging of the five sets of financial accounts previously maintained by GRNSW. The Board took the view that one consolidated set of accounts provides the most efficient means of managing the financial affairs of the industry, allowing the flexibility required to react to market events whilst eliminating administrative duplication. The financial accounts which appear in this Annual Report have adopted the new consolidated structure. This will allow for easy comparison in future years. Further, for this year only the notes to the accounts also include year-to-year comparisons for the five individual accounts previously run by GRNSW, providing the highest possible level of clarity at this time of change. The changes have also resulted in some differences in the table on page 10 of this report. For example, in previous years the cost of administration was noted only as a charge against the industry for funding GRNSW whereas in 2011/12 the operational revenue received by GRNSW (for items such as licensing, registration, namings, transfers etc) has been shown as an income item. The GRNSW administration account did experience its own one-off abnormal costs during 2011/12. Due to the re-structure of integrity operations and the establishment of the control room at Rhodes a number of long-serving staff members in the Racing & Integrity department elected to take redundancies. While this came at substantial cost to the business, it has also seen over $225,000 removed from employee leave provisions in the balance sheet. Prizemoney levels for standard races remained unchanged during the 2011/12 financial year (before a $625,000 increase came into effect on 7 July 2012). However increases were made to the prizemoney loading allowances paid to clubs. This enabled the clubs to meet the new standards introduced by AGRA which increased minimum prizemoney levels for Group races. This change alone saw over $250,000 added to prizemoney payments in 2011/12. Clubs which further supplemented prizemoney levels in 2011/12 were once again rewarded via the Club Incentive Scheme. The scheme pays clubs which host tote facilities a rebate based on TAB turnover at their meetings as well as an incentive payment which is based on prizemoney paid over and above the amount they receive in distribution from GRNSW. In order to qualify for a payment, clubs must also trade at a profit on Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA). In 2011/12 clubs responded by paying out $1,171,267 more in prizemoney than the GRNSW minimum which shows that the scheme is producing the desired result by putting even more money back in to the hands of owners and trainers. The amount each club received as an incentive payment this year is detailed in the table on page 29 along with on-course tote commissions and distribution payments. Whilst the table on page 10 indicates a sharp rise in spending on Industry Infrastructure, this item is also affected by the change in accounting practices. Until 2010/11 the expenditure attributed to this area was simply the allocation made to the Greyhound Industry Development Fund (GIDF). The reality was that spending in the GIDF never equated exactly to the allocation, with the actual spend being determined by the volume of projects undertaken. The 2011/12 expenditure of $3,493,445 is almost equal to the actual GIDF spend of $3,401,868 in 2010/11. Both of the last two years have seen GRNSW continue an unprecedented modernisation of systems and practices within the sport. In 2011/12 just over $1 million was allocated to the ongoing development of the OzChase IT system the Joint Venture with Racing & Wagering WA which will now host every greyhound jurisdiction in Australia except Victoria plus infrastructure for the remote stewarding initiative as well as continual improvements to our online offerings. Industry Advancement Projects again included programs such as Betfair Blue Paws, Greyhounds as Pets, Greenhounds, the GRNSW Country Challenge, Club Partnership Grants (for marketing and promotion) and the hosting of the Betfair Greyhound of the Year. 11

14 RACING REVIEW 2011/12 Racing Review They say greyhound racing is one of the greatest levellers. Well nothing summed that up more than the 2011/12 racing season which started with a battling trainer from the tiny NSW town of Reefton taking centre stage and ended with Australia s leading trainer, who makes $5 million a year from greyhound racing, basking in Group 1 glory. In between that a NSW trainer won his third Betfair Greyhound of the Year award, a young Victorian dog came from relative obscurity to win the richest greyhound race in the world, while a superstar emerged from Western Australia winning 15 races in a row, breaking track records across Australia and capturing the public s hearts. That s right, the 2011/12 racing season had it all. And it all kicked off in July when Reefton trainer Margaret Bannerman took out the K.S Black & Co. Country Challenge with her kennel star Pindari Bale at Wentworth Park. The win was just reward for the duo who travelled thousands of kilometres around the state to compete throughout the 2010/11 GRNSW Country Challenge series. The Showdown victory was made even sweeter due to the fact that Bannerman and Pindari Bale just missed out on the $12,500 prize for being the overall GRNSW Country Challenge winner after losing on a countback to Proper Lucy. On the same night, racegoers saw some of the best up and coming stayers in the state going head to head in the final of the inaugural Sportingbet Super Stayers Series, in which Melkate was victorious for Carolyn Reinke. As NSW shivered through August, the racing action headed to the warmth of the Sunshine State for the National Sprint and Distance Championships at Brisbane. And it was almost success for NSW in the Sprint Championship with Cold Fusion finishing second to Metz Magic. Adding to the NSW heartbreak, Queensland made it a clean sweep when Dashing Corsair took out the Distance Championship, defeating a quality field that included NSW representative Zipping Lad. Dashing Corsair s feat was made all the more remarkable considering he won the National Sprint Championship in With the arrival of Spring came the arrival of NSW s first Group 1 win of the season, when the Anthony Azzopardi-trained Fancy Will scored a surprise victory in the Greyhound Recorder Paws Of Thunder. A little over a month later and another NSW greyhound Spring Gun took out the Vic Peters Classic at Wentworth Park, giving trainer Christine Oldfield and owner Greg Board what they described as their greatest thrill in racing. Of course it would not have been a greyhound racing season without Young-based owner Paul Wheeler enjoying Group 1 success. But even he was in a state of shock when he qualified seven of the eight runners in the Melbourne Cup in November. Wheeler s power in numbers paid off, with one of his many star greyhounds Dyna Tron winning the cup. Dyna Tron went on to win the Hobart Thousand and was eventually crowned Australian Greyhound of the Year before being retired to stud. Before the calendar year was out, Noble Pedro stunned Wentworth Park onlookers by breaking Queen Lauryn s three year 520m track record on his way to winning the Group 3 AAA Radiators Specialist Christmas Gift. The start of a new year brought more group racing glory. Newcastle took centre stage with Unibet Gardens staging two Group 1s - the running of the Newcastle Herald National Derby and Forsythe s National Futurity. Midnight Capers for the Pringle family upstaged her more fancied rivals in the Futurity, while Sure As scored a runaway win to take out the Derby, much to the delight of his popular trainer Sid Swain. 12

15 Oaks Road, meanwhile, started 2012 where he left off 2011 winning. He took out the Group 2 Multiquip Bob Payne Sprint at Wentworth Park in January before heading west and defeating a quality field to win the Group 1 Sky Racing Perth Cup. Oaks Road then took centre stage along with Zipping Lad and He Knows Uno as the nominees for the 2011 Betfair Greyhound of the Year in what was described as one of the closest contests in years. The sport s elite gathered in the Grand Ballroom at the Sydney Hilton to see super stayer Zipping Lad be crowned the state s top greyhound, giving his trainer Jason Mackay his third Greyhound of the Year success. The honour was just reward for Zipping Lad who had won 20 races in 2011 including the Group 3 Summer Cup. A fortnight later and the best greyhounds in Australia descended on Wentworth Park in a bid to win the Macro Meats Golden Easter Egg the richest greyhound race in the world. Adding to the spectacle of the Golden Easter Egg was the appearance of superstar Miata in the heats of the Hotham Body Repairs Association Cup the state s richest staying race. While it is hard to imagine one greyhound taking attention away from the world s richest greyhound race, Miata did just that breaking the 720m record in her first start at Wentworth Park and registering her 12th straight win. Come final night and both greyhounds did not disappoint. Miata romped to her 13th straight win, while Don t Knocka Him collected the $250,000 winners cheque for trainer Jason Thompson and owner Reg Kay for winning the Golden Easter Egg. Miata went on to record 15 straight wins before being beaten in the final of the Sandown Cup. The arrival of May saw all NSW greyhound tracks get behind the red rug to support GRNSW s 65 Roses campaign that raised money for Cystic Fibrosis NSW and Cystic Fibrosis Australia. Throughout the month, each GRNSW track staged their own 65 Roses Race Meeting, with GRNSW donating $250 to Cystic Fibrosis every time a greyhound wearing the red rug won a race at those meetings. The campaign culminated in a cocktail function at Wentworth Park where the track s iconic tower was turned red to celebrate the occasion. Fittingly, the 65th red dog winner came on the final day of the campaign (May 31) and in the final 65 Roses Race Meeting at Dapto. In total more than $40,000 was raised for Cystic Fibrosis NSW and Cystic Fibrosis Australia. The racing season rounded off in June, but not before Paul Wheeler could grab a final Group 1 to add to his mantelpiece. Garrick Bale put every paw right to win the Rapidvite Peter Mosman Classic to ensure Wheeler s greyhound operation won $5 million in prizemoney for yet another season. While Miata mania was taking over NSW, a Victorian greyhound by the name of Don t Knocka Him showed he was the one to beat in the Golden Easter Egg after an easy win in his semi final. Presentation to Vic Peters Classic winner Spring Gun 13

16 RACING & INTEGRITY Race Day Integrity Changes In 2011/12 GRNSW introduced a set of industry-leading regulatory reforms that led to major changes in the approach to race day integrity operations. Under the reforms, GRNSW established a control room at its head office in Rhodes. The control room is manned by a Race Day Controller, who is assisted by an on-track Integrity Officer. During a race meeting, the control room receives live feeds of race broadcast footage, surveillance footage from the kennel blocks, while utilising video conferencing equipment to facilitate communication between the tracks and control room in real time. This Australian-first approach to stewarding has allowed GRNSW to improve the oversight of greyhound racing in NSW to unprecedented levels by making best use of technology. The central control room has enhanced integrity services by allowing for advanced monitoring of betting trends, early identification of potential incidents, detailed post meeting reviews and one central contact point for race day operational matters. It has also significantly enhanced the coverage of venues which were only serviced by one Steward (eg. Casino and Lismore meetings). It also reflects modern wagering practices which have shifted from on-course to off-course wagering operators. The package of regulatory reforms and enhancements is consistent with a number of strategies outlined in Chasing 2020 and have helped create a world class integrity model that provides increased certainty and confidence to punters. The changes have been rolled out over the vast majority of TAB tracks, with more tracks to adopt the new operating model in 2012/13. National Rule Changes On 25 October 2011, Greyhounds Australasia announced amendments to the National Racing Rules, effective 1 January The most significant Rule changes for participants were those made to Rules 24, 32, 56, 57 and 86. The change to Rule 24 meant that the 28 day ban on a greyhound in season now begins from the date of the meeting that the greyhound was initially withdrawn. The amendment to Rule 32 meant the onus to present a greyhound in proper condition for racing now lies with the trainer rather than the handler. The change to Rule 56 included a new rule that allows stewards to declare a greyhound a non-runner if they had their chances in a race prejudiced by extraordinary circumstances. This rule means stewards are no longer obliged to declare a no race when only one or a small number of greyhounds have had their chances prejudiced. Stewards still have the discretion to call a no race if too many greyhounds have been affected by extraordinary circumstances. The change to Rule 57 means greyhounds withdrawn from a postponed meeting are now permitted to take their starting place when that meeting is rescheduled. This only applies to greyhounds who have not incurred a period of incapacitation. The amendment to Rule 86 created a specific offence for a person to use or have in their possession any device that is capable of hindering the performance of a greyhound during a race meeting or performance trial. This includes laser pointers, squeakers or similar devices. Other amendments included: Amendments to Rule 1 Definitions - add the meaning of a greyhound identification card; Amendments to Rule 136 Result of service - clarifies that a litter of pups can not be relocated from their whelping address until they have been micro chipped; and Amendments to Rule 137 Registration of a litter - allows for pups to be vaccinated at 10 weeks of age instead of from 12 weeks. Local Rule Changes The GRNSW Board approved a number of new rules in 2011/12. In September, a policy was introduced allowing the administration of Prednefrin Forte eye drops for greyhounds affected by Pannus, which is a debilitating eye condition. The policy was approved following an extensive study conducted by GRNSW s Greyhound Welfare and Veterinary Services Unit. In May, the GRNSW Board approved a new rule which outlines the distance a greyhound must trial over when they have been stood down for offences such as marring or failing to pursue the lure. The new rule was adopted after GRNSW stewards fielded many requests from trainers who were seeking to trial offending greyhounds over distances that were much shorter than the races in which an offence occurred. New criteria were also introduced in 2011/12 regarding greyhounds nominating for performance trials after it was 14

17 Appeals During 2011/12, six appeals to the Racing Appeals Tribunal relating to greyhound racing matters were determined (compared to seven in 2010/11). Result Upheld 0 Dismissed 3 Dismissed Penalty Varied 3 Withdrawn 0 Disciplinary action against participants in 2011/12 involved 11 disqualifications (seven in 2010/11) and fines totalling $35,040 ($28,150 in 2010/11). West Australian Superstar - Miata found many greyhounds which competed satisfactorily were subsequently being entered for further trials at the same track, taking the place of greyhounds which had not yet passed their first trial. Goulburn Starts TAB Racing In September 2011, GRNSW announced Goulburn would undergo a significant upgrade of its racing facilities that would allow the club to conduct regular TAB C meetings from the middle of The $900,000 upgrade to the Goulburn facilities was made possible due to an unprecedented three-way partnership between the NSW Government, Goulburn Mulwaree Council and GRNSW. The new facilities include a world-class kennel block and a new judge s tower. The upgrade was completed on schedule and on budget in July 2012 and the first TAB C meeting took place at Goulburn on 31 July The introduction of TAB C racing at Goulburn provides an extra option for owners and trainers based between Sydney and Canberra and other parts of Southern NSW. Drug Analysis and Testing Year % of positives No. of samples tested /12 resulted in the highest number of samples being tested in the last ten years. Of the 3,783 samples tested during 2011/12, 48 returned positive results the highest percentage of positives recorded since 2006/07. While the increase in positive swabs is disappointing, it underlines the success of GRNSW s current approach to drug detection which includes a policy of target testing based on form and precedent, as opposed to the random draw after the race. For the 2012/13 financial year, GRNSW has nearly doubled its swabbing budget, a rise that will allow the number of swabs in the TAB sector to increase to an average of 7.5 swabs per meeting. It will also result in the swabs to starter ratio rising by more than 2.5 times. The increased expenditure on drug detection will result in the number of swabs being carried out at TAB meetings increasing from 2,764 to an estimated 6,750 in the 2012/13 financial year a rise of more than 150%. 15

18 GROWTH & SUSTAINABILITY Greenhounds In October 2011, GRNSW and the Hon. Don Page, Minister for Local Government, launched the Greenhounds program at a special event at the Sydney Mint, in the heart of Sydney s CBD. The program allows for pet greyhounds to go muzzle free in public places after they successfully complete a re-training program and are deemed suitable by an approved Greenhounds assessor. Once approved, all Greenhounds must wear a special green collar with ID tag at all times when in public. The program was made possible after the NSW Companion Animal Regulations were amended to provide the muzzle exemption and brings NSW in line with Victoria, Queensland, South Australia and the Australian Capital Territory. The Greenhounds program has already delivered numerous benefits since its launch. Not only has it changed the perception that greyhounds are an aggressive breed, it has also improved the transition of greyhounds from racing to life as a companion animal, which is an ongoing commitment of GRNSW. In addition, the Greenhounds website provides the public with easy to access information about greyhounds, including those that are available for adoption. Current owners of greyhounds have embraced the Greenhounds program, with the 100th Greenhound approved for muzzle exemption in July GRNSW s Greyhounds As Pets became officially approved by the NSW Government as the first Greyhound Re-Training Program. The approval means GRNSW Greyhounds As Pets can re-train retired racing greyhounds in order for them to be assessed for muzzle exemptions through the Greenhounds program. This will allow prospective greyhound owners to adopt greyhounds that have passed official re-training tests and that are also muzzle exempt. Greyhound Welfare and Veterinary Services Unit In July 2011 GRNSW established its own Greyhound Welfare and Veterinary Services Unit. This resulted in GRNSW assuming responsibility for the provision of on-course veterinarians at all TAB meetings, with the rollout having already occurred at metropolitan and provincial tracks. The primary functions and responsibilities of the GRNSW Greyhound Welfare and Veterinary Services Unit are: Provision of veterinary services at TAB meetings and for the Greyhounds As Pets program; Development and implementation of a canine health and welfare program; Providing expert advice to GRNSW on veterinary matters; and Taking strategic responsibility for the development and oversight of research programs into drug issues. Headed by one of Australia s most respected greyhound veterinarians, Dr Brian Daniel, the GRNSW Greyhound Welfare and Veterinary Services Unit has brought a level of skill, expertise and knowledge to GRNSW that it previously did not have. Since its establishment the unit has developed and published a number of welfare policies, such as the Hot Weather Policy, which provides advice on what owners and trainers can do to ensure the welfare of their greyhounds on hot days. The unit has also been working on a series of fact sheets, with the first release covering Pannus, a common condition in greyhounds. 16

19 Pannus Exemptions From 1 January 2012 GRNSW introduced a rule change that created an exemption for eye drops to be used on greyhounds affected by Pannus. Pannus, or chronic superficial keratitis, is a common condition seen in greyhounds that affects the surface of the eye. If left untreated, it can cause visual impairment. The new rule means greyhounds that are registered with GRNSW as being affected by Pannus are allowed to race without penalty while undergoing treatment. The exemption is only granted after owners and/or trainers follow a prescribed process which formally records their greyhound as Pannus affected. The change improves the welfare of greyhounds affected by Pannus by ensuring they receive adequate treatment for the condition, while also prolonging their racing career. Greyhound Welfare GRNSW embarked on a number of initiatives in 2011/12 that continued to drive improvement and cultural change in the area of greyhound welfare, including: The introduction of a policy in July 2011 that makes the attendance of veterinary surgeons on-course at all Non- TAB meetings compulsory. Previously these meetings were only required to have a veterinary surgeon on call; The ongoing development of policies to ensure the accountability of greyhound welfare across the entire lifecycle, including Codes of Practice for breeding and rearing; Expansion of the Greyhounds As Pets and Corrective Services NSW partnership, through the introduction of a foster program at the Dillwynia Correctional Centre; and Development of reporting procedures - in partnership with the RSPCA - to ensure complaints about the welfare of greyhounds are dealt with under the Rules of Racing and appropriate laws. Funding for Industry Training Pilot In 2011/12 GRNSW secured more than $70,000 from the NSW Department of Education and Communities to develop a pilot program which is aimed at improving the skills of people who are working in the greyhound racing industry. The funding was sourced by GRNSW to tackle the lack of training and development opportunities for NSW participants that want to learn different aspects of greyhound racing or receive recognition for skills they have gained through on-thejob experience. The pilot will address significant skill gaps within the industry, with a particular focus on Work Health and Safety. It will also prepare participants with training in relevant skills such as handling and transporting greyhounds, performing kennel responsibilities, and complying with the Rules of Racing. GRNSW is now working with the NSW Department of Education and Communities, State Training Services and the Hunter Institute of TAFE to develop the pilot program, to ensure it is relevant, consistent and adheres to industry protocols. The program is due for release in October

20 INDUSTRY & STRATEGY OzChase In July 2010 GRNSW entered into a partnership with Racing and Wagering Western Australia (RWWA) to develop a new information technology system encompassing commercial and regulatory operations. The Joint Venture Greyhound Racing System, known as OzChase, has already helped streamline and upgrade various business practices within GRNSW. Over the 2011/12 financial year, GRNSW and RWWA continued to develop phase two of OzChase, which shifted towards a focus on enabling the system to host the operations of Tasmania, South Australia and Northern Territory. These greyhound racing jurisdictions went live on the system on 6 August 2012 with basic racing functionality and full licensing and registration capabilities. The next phase in OzChase development includes modules for stewarding, race day operations, grading, microchip management and penalties, as well as an improved animal welfare capacity which will enable lifetime tracking of greyhounds, due for completion in early Importantly, the system will also be hosting all greyhound racing jurisdictions in Australia (with the exception of Victoria), bringing unprecedented operational efficiency to the sport. GRNSW is confident that once implemented, OzChase will not only significantly improve its internal processes, but also the quality of its outward customer service to all members of the sport. Operating Standards The ongoing modernisation of the Operating Standards for NSW Greyhound Racing Clubs continued in 2011/12. GRNSW reviewed and updated Standard 10 to reflect the introduction of new national model legislation that came into effect in NSW on 1 January 2012, known as the Work Health and Safety Act 2011 and the Work Health and Safety Regulations The new standard, now titled Work Health & Safety Policy and Compliance, was reviewed to ensure it is consistent with the new Work Health & Safety (WHS) laws and that clubs have upto-date information on their obligations under the legislation. The standard provides detailed information to clubs which will assist them to establish and implement robust systems and procedures in WHS. The new standard is simpler and easier to understand, with a revised WHS Document Toolkit including improved templates and tools, reducing the administrative burden on NSW greyhound racing clubs. 18

21 GRNSW continues to provide public liability insurance cover for the majority of clubs, which assists them in meeting the requirements of Standard 9 - Insurance Coverage - of the Operating Standards for NSW Greyhound Racing Clubs. GRNSW s management of the policy has led to continued reductions in insurance premium costs for NSW greyhound racing clubs. There have also been a reduced number of claims from accidents and reduced costs for GRNSW as the administrator of the sport. These improvements have been facilitated by the Operating Standards for NSW Greyhound Racing Clubs that have led to higher levels of compliance and stronger operations, improving the risk management, performance efficiency, safety and accountability of NSW greyhound racing clubs. Infrastructure Projects Throughout the 2011/12 financial year the Greyhound Industry Development Fund (GIDF) supported a number of maintenance items and new projects across NSW clubs including: $315,000 for the new kennel facility and judges tower at Goulburn. This project was equally funded in conjunction with the Goulburn Mulwaree Council and the NSW State Government; $118,000 for the grandstand seating replacement at Wentworth Park Sporting Complex; $73,000 for the upgrade of the lure system at Bathurst; $48,500 for the upgrade to the catering facilities at Grafton; and $26,000 for the irrigation system upgrade at Wagga Wagga. Over the past year GRNSW approved a total of 62 projects through the GIDF and a total of 263 projects through the Maintenance & Venue Improvement Allowance program. Betfair Blue Paws The Betfair Blue Paws Breeders and Owners Incentive Scheme has paid out over $1.5 million in bonuses since its inception. A total of 12,791 eligible races have been conducted throughout NSW across both TAB and Non-TAB tracks, with bonuses paid to 4,058 winners. In addition, over 12,500 pups have been nominated into the scheme. A statistical summary of the Betfair Blue Paws Breeders and Owners Incentive Scheme for the 2011/2012 financial year is as follows: Number of New Blue Paws Nominations 2,547 Number of Blue Paws Races 2,502 Number of Blue Paws Nominated Winners 929 Winning Percentage of Blue Paws Races 37.13% Bonuses Won and Paid $325,753 Trial Tracks The following trial tracks were registered in accordance with the GRNSW Trial Track Registration Policy during 2011/12: Abernethy Trial Track Box Hill Trial Track Cardiff Greyhound Social Club Casino Trial Track Cessnock and District Agricultural Association Glengarrie Trial Track Keinbah Trial Track Sunny Lodge Education Centre Tubbul Breaking In Centre Wollondilly Trial Track. 19

22 PUBLIC RELATIONS & DIGITAL 65 Roses Campaign In May 2012 GRNSW launched the 65 Roses campaign which helped raise money for Cystic Fibrosis Australia and Cystic Fibrosis NSW. GRNSW Eve McGregor presents a cheque for $40,636 to Cystic Fibrosis Australia CEO David Jack. Cystic Fibrosis is the most common life threatening, recessive genetic condition affecting Australian children. At present there is no cure, however, organisations such as Cystic Fibrosis Australia (the national body) are dedicated to funding further research into the condition and Cystic Fibrosis NSW to providing services and support to people in NSW who live with Cystic Fibrosis. As part of the 65 Roses campaign, each of the 35 greyhound racing tracks in NSW staged their own 65 Roses Race Meeting in May Every time a greyhound wearing the red rug (number one) won a race at a 65 Roses Race Meeting, GRNSW donated $250 to Cystic Fibrosis. The highlight of the campaign came when the target of 65 Red Dog winners was fittingly reached at the final 65 Roses Race Meeting at Dapto on 31 May Due to the support of all NSW greyhound clubs, the campaign was a huge success with more than $40,000 raised for Cystic Fibrosis NSW and Cystic Fibrosis Australia. This was the biggest single donation to the organisations annual fundraising campaign which aims to improve the lives of people living with Cystic Fibrosis. The campaign also exposed the sport to members of the public across NSW who had previously had no involvement or interest in greyhound racing. This was helped by the support of the WIN and NBN Television networks, who were GRNSW s media partners for the entire campaign. Betfair Greyhound of the Year Awards More than 340 people descended on the Sydney Hilton on 3 March 2012 for greyhound racing s night of nights - the 2011 NSW Betfair Greyhound of the Year. It was the third year Betfair had been involved with the event and underlines the company s support for greyhound racing in NSW and the sport s participants. The judging panel had their toughest task in years sorting through a top list of candidates to decide the three finalists for the top award. They eventually decided the Jason Mackay trained Zipping Lad should win the award, edging out fellow nominees Oaks Road and He Knows Uno. In other major awards former long serving Casino Greyhound Club secretary Don Waldron was awarded the prestigious Allen Wheeler Medal for lifetime achievement, Richmond Race Club was named Greyhound Recorder Club of the Year, Andy Lord won the Virbac Animal Health NSW Trainer of the Year title, and the Mudgee Guardian took out the Betfair Media Coverage of the Year award. Media personality and greyhound owner Russell Barwick once again hosted the evening, which featured extensive video highlights of the achievements of the various award winners, thanks to The Dogs TV. As part of the constant evolution of the event, the 2012 Betfair Greyhound of the Year awards will be staged at the iconic Sydney Town Hall in March Media Exposure Across 2011/12 there were more than 1,100 print articles, radio and television spots in the NSW media with mentions of GRNSW or its programs. This figure also includes any mention of greyhounds in metropolitan media. 20

23 This equates to more than seven hours of radio and TV airtime and a cumulative viewing audience of 210 million people across the entire country. There was also 219 photographs published featuring greyhound racing during the year. The following programs, events and issues received regular coverage during the 2011/12 financial year: the 65 Roses campaign; the GRNSW Country Challenge; the NSW Betfair Greyhound of the Year; Greenhounds; the Macro Meats Golden Easter Egg; and the settlement of the Race Fields Legislation High Court case. Club Partnership Grant In 2011/12 the Club Partnership Grant (CPG) was used by clubs right across the state to help fund marketing and promotional activities. The funds were used to promote greyhound racing to the wider general public and particularly in regional areas surrounding major race meetings and Country Challenge Finals. This year the funds were especially valuable for clubs to boost their promotional campaigns for the 65 Roses Race Meetings. Many clubs used the CPG to advertise the charity meetings locally and also provide extra exposure through the GRNSW television commercials. The CPG was also used extensively by TAB tracks to promote their major race carnivals. Wentworth Park put its CPG allocation to good use in promoting the richest race in the world - the Macro Meats Golden Easter Egg - with funds providing for a large video screen for final night, mobile advertising through the City of Sydney and promotional flyers across the local Glebe and Ultimo areas. Website The industry leading website thedogs.com.au continued to go from strength to strength over the past 12 months, with the portal now boasting more than 18,000 members. GRNSW continues to provide three weekly newsletters to subscribers with all the latest greyhound racing news and tips, while the monthly E-Chaser newsletter has also garnered a solid following. Overall, website traffic has significantly increased from the 2010/11 financial year with a 19% increase in unique visitors accessing thedogs.com.au over the last 12 months. Visits increased by more than 15% across this time with a total of million page views. The most popular pages across the portal were race fields, race results and expert form guide pages, which can all be accessed free of charge by members. In October 2011, GRNSW launched to coincide with the launch of the Greenhounds program. The Dogs TV The last 12 months has marked the second full year of operation for The Dogs TV which has proved to be an industry leader in online video content. The site has drawn on the support of a host of industry personalities in providing regular and feature programs, combined with race replays from all TAB tracks. The Dogs TV had more than 410,000 video views logged in the 2011/12 period, up 29% on the previous 12 months. The highest viewed content on The Dogs TV included the coverage of the National Championships in Brisbane, the exclusive announcement of the 2011 Betfair NSW Greyhound of the Year nominees, as well as the official announcement of the 2012 Macro Meats Golden Easter Egg heats fields. Social Media Communication activities continued to focus heavily on social media across the 2011/12 year. Increased conversation was experienced through Facebook and Twitter channels, as well as the Dogs TV YouTube channel. Followers also increased on the Greyhounds As Pets Twitter and Facebook pages. As can be seen in the following table, by July 2012 GRNSW had 4,637 Facebook fans (2,397 in July 2011) and 1,545 followers on Twitter (1,028 in July 2011). Facebook Fans GRNSW 4,637 Greyhounds As Pets 2,267 Greenhounds 2,296 Twitter

24 CHASING 2020 Chasing 2020 Progress Update - Status of Year 2 Projects Strategy Growth Project Outcome GRNSW will develop targeted information and support services to remove current barriers to ownership in NSW, including: A detailed ownership guide Detailed ownership guide Syndication is a key element of greyhound ownership. GRNSW is unable to finalise the ownership guide without clarity around the legality of the greyhound syndication model GRNSW continued to work with Greyhounds Australasia and the Australian Securities and Investments Commission (ASIC) to develop a sustainable syndication model that meets the needs of the NSW and Australian Greyhound Industry. Awaiting final ASIC decision on regulatory relief for greyhound syndication activities Develop a business development package to assist clubs to grow revenue and on course attendance Image GRNSW will undertake targeted advertising and promotional campaigns to drive increases in wagering revenue, passive ownership and oncourse attendance by drawing on the strengths of the sport to market the product Business development package Targeted advertising and promotional campaigns Deferred pending outcomes of GRNSW strategic direction review Customer Relationship Marketing Manager added to GRNSW team Implementation of targeted strategies to begin in the second half of 2012 GRNSW will increase the awareness and knowledge of greyhounds through showcasing of the breed via targeted media, thedogs. com.au, increased community engagement, as well as committing additional resources to a revamped and refocused Greyhounds as Pets program Promotion and showcasing of the greyhound breed GRNSW continued to produce and release promotional pieces on The Dogs TV during 2011/12. Greyhounds As Pets officially approved by the NSW State Government as the first Greyhound Re-Training Program Develop an integrated promotions package to assist clubs to advance greyhound racing in their community Racing GRNSW will review the NSW breeder and owners incentive scheme to ensure a model that spreads rewards optimally amongst participants GRNSW will develop and implement standards and guidelines for consistent track preparation for trials and racing across the TAB sector to ensure punter consistency and improved animal welfare GRNSW will explore ways to enhance the collection of racing data and improve consistency in the provision of race results and data GRNSW will develop and trial a new method of prize money allocation at TAB tracks to improve product attractiveness, encourage increased wagering and maximise racing opportunities for greyhounds Integrated club promotions package Review of breeders and owners incentive scheme Development of standards and guidelines for consistent track preparation Race data and results Higher prize money levels for graded races run over the distance of 565m or above Finalisation and production of club promotions package delayed pending outcomes of GRNSW strategic direction review Project delayed pending the implementation of phase three of OzChase in 2013 Training guidelines complete, with rollout scheduled for the second half of 2012, with a focus on WHS compliance Short report delivered outlining best practice methods in race data collection domestically and internationally Collection of additional sectional timing to be implemented at selected TAB tracks in the second half of 2012 Higher prize money levels for graded races run over the distance of 565m or above to continue during 2012/13 22

25 Chasing 2020 Progress Update - Status of Year 2 Projects... cont d Strategy Sustainability Project Outcome Drive welfare improvement and cultural change to ensure greyhound racing in NSW meets community expectations through: Licensing of breeders and rearing establishments GRNSW continued work on three new Codes of Practice for the areas of breeding, rearing and greyhound pre training - to be released in 2013 Improved licensing and regulation of Development and breeders, trainers and rearing establishments implementation of the Increased re-homing of greyhounds Greenhounds Initiative Continued promotion of Greyhounds as Pets and the greyhound breed in general GRNSW will develop and implement training courses and information seminars to assist participants and club administrators to develop skills and knowledge in a range of areas GRNSW will improve the information and support tools provided to participants, clubs, prospective owners and interested stakeholders on thedogs.com.au, including: Owner, trainer and breeder case studies on thedogs.com.au and The Dogs TV A review and improvement of the public trainers listing A revised and expanded cost index, including industry accepted rearing, breeding, break-in and training fees / deals GRNSW will support the next generation of participants through the exploration and creation of education, skills development and accreditation opportunities in partnership with training organisations Information seminars for clubs and participants Owner, trainer and breeder case studies Public trainers listing Review of ownership cost index and associated information Skills enhancement pilot program The Greenhounds program - to facilitate the muzzling exemptions for retired racing and pet greyhounds - was launched in October 2011 The Greyhounds As Pets program is continuing to grow through its ongoing relationship with the NSW Department of Corrective Services, with an additional 28 kennels expected to be ready in December 2012 The GRNSW Greyhound Welfare and Veterinary Services Unit developed facts and information documents about racing and pet greyhounds Training material developed during 2011/12 and seminars for participants to commence in October 2012 Seminars being developed include: Substance and swabbing education Introduction to responsible breeding Introduction to greyhound racing and race day kennel operations Multiple owner, trainer and breeder case studies were produced and released on The Dogs TV during 2011/12 There is currently a lack of appropriate data to inform the review. Project will resume following the implementation of phase three of OzChase in 2013 The revised ownership cost index will be released in 2013 in conjunction with the Codes of Practice for breeding, rearing and pre training GRNSW secured funding through the NSW Department of Education and Communities to develop a pilot course - Cert II in Racing (Greyhound) to commence in October 2012 In addition, as part of the vocational and education framework GRNSW with TAFE developed formal training procedures for: Microchip Implantation Identify and respond to greyhound behaviour Governance Continually develop and adopt best practice in integrity operations Improved regulatory operations In September 2011, GRNSW implemented world class regulatory reform overhauling Race Day Integrity Services, delivering enhanced scrutiny of TAB racing in NSW Become an innovator in information technology through the development of a new computer system for managing integrity and commercial operations Development of new information technology system for commercial and regulatory operations Development of OzChase continued during 2011/12, with modules covering race day operations, grading and penalties to be delivered in

26 The Board Eve McGregor - Chairman BA LLB Ms McGregor is a Corporate Lawyer with extensive in house experience in the areas of media rights, licensing and distribution, copyright and general commercial matters. Ms McGregor was appointed to the Board of GRNSW in February Ms McGregor is a former Senior Corporate Lawyer at Sky Channel and Tabcorp, and prior to this held senior legal roles with the Australasian Performing Rights Association, the Australasian Mechanical Copyright Owners Society and Southern Star Entertainment. Most recently, Ms McGregor has acted as the Senior Legal Counsel at Fox Sports and as a consultant to an Australasian Racing Rights Holder. Ms McGregor has been Chairman of GRNSW since February David Clarkson - Deputy Chairman MA (Oxon) FCA Mr Clarkson is a Chartered Accountant, having worked for Ernst & Young in London and Sydney. He was appointed to the Board of GRNSW in February He is currently the Financial Controller and Company Secretary of the Australian Financial Markets Association. From 1987 to 2006 he was the Finance Manager of the Australian Jockey Club and is a former Director of the Dubbo Turf Club. 24

27 Murray Nicol MBA (MGSM) Mr Nicol was appointed to the Board of GRNSW in May His 40 years experience in nearly all facets of the gaming and wagering industry commenced with the NSW TAB in He has formerly held senior positions with AWA Totalisators, Club KENO, Stargames and Shuffle Master Inc. USA and consulting positions to NSW Racing, Tabcorp Victoria and Sportsbet Australia (NT). Mr Nicol is also a past President of the New South Wales National Coursing Association. George Bawtree BA FIPAA Mr Bawtree is a consultant working in the public sector, particularly on major infrastructure projects in the area of stakeholder relations, communications and probity. He was appointed to the Board of GRNSW in February From 2004 to 2007 he was the Chief Executive of GRNSW and prior to this held senior positions in Sydney Water. Mr Bawtree has extensive involvement in volunteer based professional, community and sporting organisations. Joyce Alamango Ms Alamango was first appointed to the Board of GRNSW in February Ms Alamango has been an active owner and trainer in greyhound racing for more than 32 years. Ms Alamango was a member of the Greyhound Racing Authority Board between 2001 and She was the Trainers representative on the Greyhound Racing Industry Participants Advisory Committee (GRIPAC) and was previously Secretary of the Registered Greyhound Participants Association (RGPA). Ms Alamango has also served as the alternate to the Chief Operating Officer on the Board of the Wentworth Park Trust. Apart from the greyhound industry, Ms Alamango runs her own small business. 25

28 BOARD MEMBERS REPORT Members Members of the GRNSW Board are appointed under the Greyhound Racing Act The names and particulars of the Board Members in office on the day this report is made out are as indicated on pages 24 and 25. Board Membership Changes Board Members are appointed for a maximum term of four years under the Greyhound Racing Act The current term expires in February There were major changes to the Board of GRNSW in this financial year. The industry representative Board of GRNSW met for the last time in January In February 2012 the first independent Board of GRNSW met, with Eve McGregor appointed as Chairman. The terms of the Members of the independent Board are: Eve McGregor four years; David Clarkson four years; George Bawtree four years; Joyce Alamango two years; and Murray Nicol two years. Meetings of Previous (Industry Representative) Board During the financial year, the previous Board met seven times. Attendance at meetings was as follows: Board Members Attended Held P. Allan 7 7 M. Nicol 7 7 G. Mangafas 7 7 J. Primmer 7 7 T. Green 7 7 J. Alamango 7 7 Meetings of Current (Independent) Board During the financial year, the current Board met five times. Attendance at meetings was as follows: Board Members Attended Held E. McGregor 5 5 M. Nicol 5 5 D. Clarkson 5 5 G. Bawtree 5 5 J. Alamango 5 5 Wentworth Park track record holder - Noble Pedro 26

29 During the period 1 July 2011 to 30 June 2012, there were no occasions when substitute delegates attended meetings of the Board. Meetings of Board Committees The Board of GRNSW has established two Committees to consider matters relating to the functions below, as well as other matters as allocated to each Committee by the Board of GRNSW from time to time, and to prepare reports and recommendations on such matters for the Board to consider as a whole. The appointed permanent members of a Committee form the core membership of each Committee. However any member of the Board who is not a permanent member of a Committee may attend any meeting of the Committee. Audit and Compliance Committee The Audit and Compliance Committee is responsible for overseeing and appraising the quality of the external audit and the internal control procedures, as well as setting, reviewing and ratifying corporate compliance policies, and overseeing the implementation of a corporate compliance system regarding financial, policy and employment issues, with a particular focus on: Financial reporting and practices; Business ethics, policies and practices; Accounting policies; and Management and internal controls. During the financial year, the Audit Committee met on one occasion. Committee Members Attended Held P. Allan (Chair) * 1 1 T. Green* 1 1 J. Primmer* 0 1 G. Mangafas 1 1 J. Alamango 1 1 * Core Members of Committee Remuneration and Nomination Committee The Remuneration and Nomination Committee is responsible for recommending to the Board: The appointment of a Chief Executive; Recommendation of policy for payment of remuneration and allowances of Directors/members; and Undertaking a detailed review of the Chief Executive s performance. During the financial year, the Remuneration and Nomination Committee did not meet. The review of the Chief Executive s performance was undertaken during a normal board meeting. Honorary Historian John Tracey continues to serve as GRNSW s Honorary Historian, collecting historical documents, photos, films and other memorabilia about the greyhound racing industry and displaying these at public venues where appropriate. Freedom Of Information There have been no Freedom Of Information requests made to GRNSW in 2010/11 or 2011/12. Subsequent Events There were no significant events after 30 June 2012 affecting the financial position of the entity. Indemnification of Officers and Auditors GRNSW has paid an insurance premium for Directors and Officers liability insurance for Members of the Board and management. GRNSW has not otherwise, during or since the financial year, indemnified or agreed to indemnify an Officer or auditor of itself or of any related body corporate against a liability incurred as such by an Officer or auditor. Core Members of the Audit Committee of the Independent Board are David Clarkson and George Bawtree. 27

30 GRICG Greyhound Racing Industry Consultation Group Established under the NSW Greyhound Racing Act 2009, the Greyhound Racing Industry Consultation Group (GRICG) has the function of consulting with and making recommendations to GRNSW on matters concerning greyhound racing in NSW. GRICG is required to meet at least six times a year. The members of GRICG are honorary and no remuneration is payable to them in respect of the duties they perform. The current membership of GRICG is as follows: Christine Mackenzie (Chairperson) TAB Clubs Representative Ron Arnold (Deputy Chairperson) Country Clubs Representative George Hayes NSW Greyhound Breeders Owners and Trainers Association Bob Green NSW Greyhound Breeders Owners and Trainers Association Mark Merlino Bookmakers representative Mark Alamango Registered Greyhound Participants Association GRICG Chairperson s Report Mark Alamango replaced Roy White as the representative for the Registered Greyhound Participants Association in February GRICG members would like to thank Roy for his contribution during his time on GRICG and wish him all the best with his personal endeavours. GRICG held six meetings during 2011/12 and discussed the following issues: Grading, in particular eligibility for Free For All races and drop-back rules; The establishment of a threshold for the testing of Procaine that differentiates between accidental ingestion through contaminated food and deliberate administration; Reinforcement of the dress code, no smoking policy while handling greyhounds and prohibition of using a mobile phone when handling a greyhound; Ongoing prize money increases, that at a minimum, cover yearly CPI movements; and Development of a greyhound show in conjunction with the Royal Easter Show to promote greyhounds to the wider community. In addition to the above issues, GRICG continues to have input into Grading Policy improvements and remains committed to pursuing equalisation in funding for TAB A and B clubs. I would like to thank participants, stakeholders and GRICG members for their support over the last year and we look forward to the challenging times that the future will no doubt bring. Christine Mackenzie GRICG Chairperson 28

31 PAYMENTS TO CLUBS SOD Club On Course Club / Entity payments Incentive Scheme Tote TOTAL Armidale 87,570 3,077 90,647 Broken Hill 150,120 5,177 2, ,420 Casino 1,141,265 89,012 46,635 1,276,912 Coonabarabran 87,570 87,570 Coonamble 106,335 22, ,318 Cowra 118,345 12, ,892 Dapto 1,506,470 82, ,103 1,700,332 Dubbo 348,930 23,117 19, ,269 Forbes 71,560 71,560 GBOTA - Appin 175,140 8,405 6, ,930 GBOTA - Bathurst 882,600 22,800 45, ,514 GBOTA - Bulli 1,199,090 4,371 58,115 1,261,577 GBOTA - Gosford 1,280,370 12,825 80,564 1,373,759 GBOTA - Gunnedah 156,375 12,009 2, ,005 GBOTA - Lismore 1,225,460 23,827 37,073 1,286,360 GBOTA - Maitland 1,145,660 33,464 47,315 1,226,440 GBOTA - Temora 175,140 6,705 1, ,956 GBOTA - Wentworth Park 9,188, , ,275 9,627,776 Goulburn 237,690 2,396 9, ,145 Grafton 400,025 43,666 25, ,415 Kempsey 162,630 8, ,027 Lithgow 237,190 6, ,599 Moree 107,090 2, ,525 Mudgee 73, ,342 Muswellbrook 174, ,147 NCA - The Gardens 2,718, ,842 2,873,617 Nowra 861,925 26,938 29, ,156 Richmond 1,882,480 10, ,806 1,997,701 Social Club 137,610 9, ,267 Tamworth 125,100 1, ,849 Taree 162,630 15,619 1, ,773 Tweed Heads 237,690 42, ,278 Wagga Wagga 293,348 46,903 14, ,759 Wauchope 149,620 9, ,597 Young 115,845 5, ,862 TOTALS 27,124, ,459 1,193,486 28,959,294 29

32 GIDF ACTIVITY Club / Entity MVIA Other Total Funding Funding GIDF Armidale 3, , Broken Hill 10, , , Casino 24, , Coonabarabran 12, , Coonamble 1, , Cowra 5, , , Dapto 42, , Dubbo 21, , Forbes 3, , GBOTA - Appin 11, , , GBOTA - Bathurst 18, , , GBOTA - Bulli 34, , GBOTA - Gosford 34, , , GBOTA - Gunnedah 6, , GBOTA - Lismore 30, , , GBOTA - Maitland 20, , GBOTA - Temora 10, , , GBOTA - Wentworth Park 282, , Goulburn 13, , , Grafton 14, , , Kempsey 3, , Lithgow 4, , Moree Mudgee Muswellbrook 10, , NCA - The Gardens 25, , , Nowra 27, , , Richmond 36, , , Social Club 9, , , Tamworth 7, , Taree 5, , , Tweed Heads Wagga Wagga 12, , , Wauchope 7, , Young 13, , GRNSW / Industry Wide 1,949, ,949, MVIA Prior Period Adjustments -8, , GIDF Prior Period Adjustments -5, , TOTALS 476, ,017, ,493, Notes: * A negative figure indicates where funding approved in a prior year was not fully expended when the project was closed 30

33 Club StatisticS Summary Average Average Average paying customers nominations starters per per meeting per meeting meeting per annum per annum per annum Club Actual Actual Actual Wentworth Park (GBOTA) Saturday Wentworth Park (GBOTA) Friday Bulli (GBOTA) Dapto 340 * Gosford (GBOTA) Lismore (GBOTA) Richmond The Gardens (NCA) Bathurst (GBOTA) Casino Dubbo Grafton Maitland (GBOTA) Shoalhaven Wagga Wagga Appin (GBOTA) Armidale Broken Hill Coonabarabran Coonamble Cowra Forbes Goulburn Gunnedah (GBOTA) Kempsey Lithgow Moree Mudgee Muswellbrook Social Club Tamworth Taree Temora (GBOTA) Tweed Heads Wauchope Young Notes: * Dapto does not charge admission 31

34 The StatisticS Board Greyhounds Year Litters Registered Greyhounds Named Wagering and Racing NSW Greyhound Market Share by Wagering Provider Market Share Totalisators 80.89% Corporate Bookmakers 15.73% Betting Exchanges 3.38% Total 100% Participants Year Trainers Owner/Trainers Attendants Owner/Trainers and Attendants categories reclassified from 1 July

35 five year comparison Racing Activity Number of Race Meetings Conducted Metropolitan TAB Non-TAB Number of Races Conducted Metropolitan 1,050 1,068 1,040 1,050 1,053 TAB 5,396 5,287 5,339 7,369 7,525 Non-TAB 7,870 7,890 7,852 5,790 5,338 Number of Starters Metropolitan 8,112 8,122 7,966 8,096 8,119 TAB 41,657 40,760 41,007 56,416 57,679 Non-TAB 58,107 57,320 57,304 42,764 40,357 Participant Returns Total Prize Money paid Metropolitan 5,594,554 6,246,067 6,785,935 6,923,275 7,222,138 TAB 6,598,967 7,952,697 9,989,882 12,326,482 12,423,075 Non-TAB 3,063,458 3,234,822 4,163,472 2,960,721 2,823,203 Total Prize Money paid as a percentage of distribution received Metropolitan 76% 77% 102% 102% 102% TAB 80% 103% 107% 109% 109% Non-TAB 95% 114% 110% 115% 117% Consumer Activity Paying attendees at NSW greyhound meetings Metropolitan 43,019 45,618 51,378 47,251 48,600 TAB 63,495 64,334 62,062 82,037 83,297 Non-TAB 78,985 70,982 70,305 49,295 46,329 Average paying attendees per meeting Metropolitan TAB Non-TAB On-course totalizator turnover on NSW greyhound meetings Metropolitan 7,204,572 7,761,102 7,598,177 5,116,772 6,785,497 TAB 17,631,686 14,520,691 14,207,473 14,763,312 15,486,267 Non-TAB 5,732,351 4,169,744 2,588,494 1,583,280 1,597,957 Total TAB turnover on NSW greyhound meetings 268,091, ,078, ,523, ,311, ,782,520 Wagering Market share of NSW greyhound product with TAB Ltd 22.1% 17.1% 17.2% 19.7% 19.6% Government Revenue Government revenue from TAB turnover on NSW greyhound meetings 17,766,424 17,898,120 18,556,998 20,726,020 21,021,768 33

36 FINANCIAL STATEMENTS FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2012 GREYHOUND RACING NEW SOUTH WALES ABN CONTENTS Statement of Comprehensive Income 35 Statement of Financial Position 36 Statement of Changes in Equity 37 Statement of Cash Flow 37 Notes to the Financial Statements 38 Declaration by Members of the Board 47 Auditor s Independence Declaration 48 Independent Audit Report 49 34

37 GROUP STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE Note $ Income Product fees 30,704,497 Racefield information use fees 8,905,038 Deferred revenue realised 12 6,913,157 Industry & strategy 434,467 Public relations & digital 599,923 Growth & sustainability 181,139 Racing & integrity 43,100 Blue Paws 106,953 Interest 1 (h) 556,102 Miscellaneous 65,857 Total Income 48,510,233 Expenditure Prizemoney 21,222,888 Club administration & funding 8,269,774 Corporate & finance 2,090,023 Racing & integrity 3,231,513 Public relations & digital 951,750 Industry & strategy 903,355 Industry infrastructure 3,172,681 Growth & sustainability 600,074 Blue Paws bonus payments 325,753 Country Challenge 132,750 NCA loan forgiven (Gardens purchase) 1 (n) 2,100,000 Loss on sale of fixed assets 187,347 Impairment expense 1 (n) 149,503 Depreciation 55,576 Bank charges 21,694 Other 34,747 Total Expenditure 43,449,428 Surplus for the Year 5,060,805 The accompanying notes form part of these financial statements. 35

38 FINANCIAL STATEMENTS GROUP STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE Note $ Current Assets Cash and cash equivalents 3 4,400,966 Trade receivables 4 10,114,166 Other current assets 6 4,175 Total Current Assets 14,519,307 Non-Current Assets Property, plant & equipment 7 1,726,387 Loan receivables 5 6,875,355 Total Non-Current Assets 8,601,742 Total Assets 23,121,049 Current Liabilities Payables 8 6,787,135 Provisions 9 1,479,872 Total Current Liabilities 8,267,007 Total Liabilities 8,267,007 Net Assets 14,854,042 Equity Reserves 676,386 Retained surplus 14,177,656 Total Equity 14,854,042 The accompanying notes form part of these financial statements. 36

39 GROUP STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE $ Retained surplus as at 1 July 9,116,851 Surplus for the year 5,060,805 Retained surplus as at 30 June 14,177,656 Reserves as at 1 July 65,523 Transfer to/(from) reserves 610,863 Reserves as at 30 June 676,386 14,854,042 GROUP STATEMENT OF CASH FLOW FOR THE YEAR ENDED 30 JUNE Note $ Cash Flows from Operating Activities Receipts from operations 52,749,544 Payments to suppliers and employees (59,012,833) Interest received 556,102 Net cash (used in)/provided by operating activities 11 (5,707,187) Cash Flows from Investing Activities Net payments for property, plant and equipment (1,358,899) Net cash (used in)/provided by operating activities (1,358,899) Net (decrease)/increase in cash and cash equivalents held 12 (7,066,086) Cash and cash equivalents at 1 July 11,467,052 Cash and cash equivalents at 30 June 3 4,400,966 The accompanying notes form part of these financial statements. 37

40 NOTES TO THE FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE STATEMENT OF ACCOUNTING POLICIES Greyhound Racing New South Wales (GRNSW) is a reporting entity. GRNSW is an independent body corporate established under the Greyhound Racing Act 2009 to represent, fund and control the commercial operations of the greyhound racing industry in New South Wales. It commenced operations on 10 February The financial report is a general purpose financial report that has been prepared in accordance with Accounting Standards, including Accounting Interpretations and other pronouncements of the Australian Accounting Standards Board. The financial report includes figures for the Group, with summary Income Statements for each activity. The following is a summary of the material accounting policies adopted by the entity in the preparation of the financial report. The accounting policies have been consistently applied unless otherwise stated. No comparatives have been disclosed, as 2012 is the first year reporting under a new consolidated financial structure for GRNSW. Basis of Preparation The financial report has been prepared on an accruals basis and is based on historical costs. (a) Property, Plant and Equipment Each class of property, plant and equipment is carried at cost, less where applicable, any accumulated depreciation and impairment losses, where applicable. Plant and Equipment Plant and equipment are carried at cost less accumulated depreciation and impairment losses. The carrying amount of plant and equipment is reviewed annually by the Board to ensure it is not in excess of the recoverable amount from those assets. The recoverable amount is assessed on the basis of the accepted net cash flows which will be received from the assets employment and subsequent disposal. The expected net cash flows have not been discounted to present values in determining recoverable amounts. Depreciation Property, plant and equipment including capitalised lease assets are depreciated on a straight line basis over their useful lives to GRNSW, commencing from the time the asset is held ready for use. Fixed asset purchases of items below $5,000 are written off to expense in the year of acquisition. The depreciation rates used for each class of depreciation assets are: Class of Fixed Asset Depreciation Rate % Office equipment 40 Computer equipment 40 Furniture fittings 15 Motor vehicles 22.5 Leasehold improvements 12.5 The asset s residual values and useful lives are reviewed and adjusted if appropriate at each balance date. An asset s carrying amount is written down immediately to its recoverable amount if the asset s carrying amount is greater than its estimated recoverable amount. 38

41 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE STATEMENT OF ACCOUNTING POLICIES (cont d) (a) Property, Plant and Equipment (cont d) Gains and losses on disposal are determined by comparing proceeds with the carrying amount. These gains or losses are included in the statement of comprehensive income. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained earnings. (b) Leases Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as an expense in the periods in which they are incurred. Lease incentives for operating leases are recognised as a liability and amortised on a straight line basis over the life of the lease terms. (c) Insurance Insurance policies are held to cover all material risks. The insurance coverage is reviewed annually to ensure adequate cover for all risk areas. (d) Financial Instruments Recognition Financial instruments are initially measured at cost on trade date, which includes transaction costs, when the related contractual rights or obligations exist. Subsequent to initial recognition, these instruments are measured as set out below. Loans and Receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are stated at amortised cost using the effective interest rate method. Financial Liabilities Non-derivatives financial liabilities are recognised at amortised cost, comprising original debt less principal payment and amortisation. Impairment At each reporting date, the entity assesses where there is objective evidence that a financial instrument has been impaired. Losses are recognised in the statement of comprehensive income. (e) Employee Benefits Provision is made for GRNSW liability for employee benefits arising from services rendered by employees to balance date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability has been settled plus related on costs. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits. (f) Superannuation Commitments Superannuation contributions made on behalf of employees are charged as expenses when incurred. (g) Cash and Cash Equivalents Cash and cash equivalents include cash on hand and deposits held at call with banks. (h) Revenue Revenue is brought to account on an accruals basis. Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets. Cash is invested in a NSW Treasury Corporation Cash Facility which returned on average 4.75% per annum during the financial year. All revenue is recognised net of the amount of goods and services tax (GST). 39

42 NOTES TO THE FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE STATEMENT OF ACCOUNTING POLICIES (cont d) (i) Receivables, Payables and Accruals Accounts receivable generally settled within 30 days are carried at amounts due. Accounts payable including accruals not yet billed, are recognised when GRNSW becomes obliged to make future payments as a result of a purchase of assets or services. Accounts payable are generally settled within 30 days. (j) Goods and Services Tax (GST) Revenue, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or part of an item of expense. Receivables and payables in the statement of financial position are shown inclusive of GST. (k) Distribution Account and Greyhound Industry Development Fund By order of the Minister of Gaming and Racing, the balance of unexpected funds in the following accounts were transferred to GRNSW on 9 February Greyhound Racing Authority (NSW) Distribution Account Greyhound Racing Authority (NSW) Greyhound Industry Development Fund Both the above funds have been administered by GRNSW since 10 February The Distribution Account receives TAB distributions to the greyhound code through NSW Racing Pty Ltd. Funds are used as follows: To pay monies to the Greyhound Industry Development Fund To distribute funds to Greyhound Racing Clubs in New South Wales The Greyhound Industry Development Fund (GIDF) makes payments to greyhound clubs predominantly for construction, maintenance work and other capital items. As at 30 June 2012 both of the above funds were closed as the accounts within GRNSW were consolidated. (l) Greyhound Industry Advancement Fund and Blue Paws Since the establishment of the Distribution Account and Greyhound Industry Development Fund by the Minister for Gaming and Racing on 9 February 2003, the following funds have been established from Board decisions of Greyhound Racing New South Wales: Greyhound Industry Advancement Fund Blue Paws Breeders & Owners Incentive Scheme The costs of administering the Distribution Account, the Greyhound Industry Development Fund, the Greyhound Industry Advancement Fund and Blue Paw Breeders & Owners Incentive Scheme are largely borne by GRNSW. As at 30 June 2012 both of the above funds were closed as the accounts within GRNSW were consolidated. (m) New Standards and Interpretations not yet adopted There are no material effects or disclosures arising from new accounting standards and interpretations. (n) The Gardens Acquisition Transaction GRNSW acquired a 70% share of the property known as The Gardens from the NSW National Coursing Association (NCA) on 1 March The transaction involved a $2,100,000 interest free repayable loan to the NCA being forgiven and an additional payment of $1,200,000. GRNSW s 70% share of the property was valued at $1,050,000 resulting in an Impairment expense of $149,

43 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE $ 2. Auditors Remuneration Results for the year has been determined after: Remuneration of Auditor KS Black & Co 26,750 The above charges incorporate services and audit of the Distribution Account, the Greyhound Industry Development Fund, the Greyhound Industry Advancement Fund, and the Blue Paws Breeders & Owners Incentive Scheme. 3. Cash and Cash Equivalents Cash at bank 4,399,816 Cash on hand 1,150 4,400, Trade Receivables Product fees 8,597,861 Racefield information use fees 1,357,629 Other 158,676 10,114, Loan Receivables Bank Guarantee 377,674 Wentworth Park Trust 6,497,881 6,875, Other Current Assets Prepayments 4, Property, Plant & Equipment Land The Gardens 70% 1,050,000 Office Equipment & Computers At cost 576,220 Accumulated depreciation (488,323) 87,897 Furniture & Fittings At cost 55,476 Accumulated depreciation (26,654) 28,822 Motor Vehicles At cost 456,269 Accumulated depreciation (103,488) 352,781 41

44 NOTES TO THE FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE $ 7. Property, Plant & Equipment (cont d) Website Development & Software At cost 579,155 Accumulated depreciation (372,268) 206,887 Total Property, Plant and Equipment 1,726, Payables Current Payments to clubs 3,116,564 Tabcorp 2,251,796 Australian Taxation Office 511,569 Sundry creditors and accruals 907,206 6,787, Provisions Current Provision for annual leave 312,103 Provision for long service leave 174,517 Provision for approved industry infrastructure funding 962,532 Other 30,720 1,479, Capital & Leasing Commitments Operating Lease Commitments Rental of Office Premises Non cancellable operating lease commitments contracted for but not capitalised in the financial statements: Property Lease Payable: No later than one year 245,700 Later than one year but not later than five years 982,800 Later than five years 491,400 1,719, Reconciliation of Net Cash (Used in)/provided by Operating Activities to Surplus Surplus 5,060,805 Depreciation 55,576 Changes in assets and liabilities: (Increase)/decrease in receivables 1,902,923 (Increase)/decrease in other assets 33,490 Increase/(decrease) in payables (13,516,372) Increase/(decrease) in provisions 756,391 Net Cash (Used in)/provided by Operating Activities (5,707,187) 42

45 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE Deferred Revenue At the commencement of the financial year GRNSW held $15,815,333 in Deferred Revenue representing Racefield Information Use Fees received from Tabcorp Holdings and TAB Ltd which remained in dispute. The dispute was settled during the financial year and saw GRNSW realise $6,913,157 as income, whilst $8,902,176 was repaid to TAB Ltd. The large repayment resulted in a significant decrease in net cash held by GRNSW $ $ 13. Activity Income Statements a. GRNSW Individual Activity Income Statement for the Year Ended 30 June 2012 Revenue Distribution account administration charge 5,977,986 5,237,369 Licensing and fees 454, ,362 Brand and public relations 569, ,791 Growth and sustainability 160,148 - Interest 7,148 3,681 Other 56,244 79,130 Total Revenue 7,226,166 6,686,333 Expenditure Corporate 2,074,243 2,157,362 Racing and integrity 3,262,601 2,892,486 Brand and public relations 917,943 1,013,530 Club and member services 524, ,849 Growth and sustainability 390, ,308 Board expenses 155, ,198 Other expenses 13,594 - Loss on sale of fixed assets 23,440 - Total Expenditure 7,363,540 6,875,742 (Deficit)/Surplus (137,374) (189,409) 43

46 NOTES TO THE FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE $ $ 13. Activity Income Statements (cont d) b. Scheme of Distribution Income Statement for the Year Ended 30 June 2012 Revenue Product fees 24,645,420 24,258,993 Wagering incentive fees 6,059,077 5,735,379 Racefield information use fees 8,905,038 5,285,537 Deferred revenue realised 6,913,157 - Interest 473, ,667 Other 9,214 - Total Revenue 47,005,865 35,808,576 Expenditure Distribution to GRNSW 5,977,986 5,237,369 Distribution to GIDF 3,950,000 2,750,000 Distribution to GIAF 750, ,000 Racefield/wagering exepenses 98, ,262 Distribution to clubs 27,124,349 26,389,285 Club incentive scheme 1,827,059 2,135,191 Integrity auditor and appeals tribunal 52,158 - Sundry expenses 34,579 73,099 Total Expenditure 39,814,871 37,926,206 Surplus/(Deficit) 7,190,994 (2,117,630) 44

47 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE $ $ 13. Activity Income Statements (cont d) c. Greyhound Industry Development Fund Income Statement for the Year Ended 30 June 2012 Revenue Transfer from GRNSW distribution account 3,950,000 2,750,000 Interest received 71,204 89,671 Total Revenue 4,021,204 2,839,671 Expenditure Capital works allocations 3,493,445 3,401,868 NCA loan forgiven (Gardens purchase) 2,100,000 - Loss on sale of fixed asset 163,907 - Impairment expense 149,503 - Loss on transfer to GRNSW - 343,329 Loss on disposal of plant and equipment - 12,745 Depreciation 55,576 45,640 Other Total Expenditure 5,962,565 3,803,656 (Deficit)/Surplus (1,941,361) (963,985) 45

48 NOTES TO THE FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE $ $ 13. Activity Income Statements (cont d) d. Greyhound Industry Advancement Fund Income Statement for the Year Ended 30 June 2012 Revenue Transfer from GRNSW distribution account 750, ,000 GAP & Greenhounds 20,991 16,423 Insurance penalties 22,900 15,000 Sponsorship 30,000 30,000 Interest received 2,657 1,813 Other Total Revenue 826, ,236 Expenditure Payments to Clubs 311, ,935 GAP & Greenhounds 209, ,423 Blue Paws 180, ,000 Greyhound of the Year 97,074 98,312 Insurance claims 10,000 17,900 Other 32,942 63,373 Interest 40 - Total Expenditure 840, ,943 (Deficit)/Surplus (13,606) (124,707) e. Blue Paws Breeders & Owners Incentive Scheme Income Statement for the Year Ended 30 June 2012 Revenue Pup contributions 106, ,658 GIAF contribution 180, ,000 Interest received 1, Total Revenue 288, ,364 Expenditure Bonus prize money 325, ,828 Bank charges Total Expenditure 325, ,007 (Deficit)/Surplus (37,850) 15,357 46

49 DECLARATION BY MEMBERS OF THE BOARD The Board of Greyhound Racing New South Wales declares that: The financial statements and notes set out on pages 35 to 46 present fairly the financial position of Greyhound Racing New South Wales as at 30 June 2012 and its performance for the year ended on that date in accordance with Accounting Standards (including Australian Accounting Interpretations). In the Board s opinion, there are reasonable grounds to believe that the entity will be able to pay its debts as and when they become due and payable. This declaration is made in accordance with a resolution of the Board of Greyhound Racing New South Wales. Dated: 27 September 2012 David Clarkson Greyhound Racing New South Wales Deputy Chairman George Bawtree Greyhound Racing New South Wales Board Member 47

50 NOTES TO THE FINANCIAL STATEMENTS AUDITOR S INDEPENDENCE DECLARATION TO THE DIRECTORS OF GREYHOUND RACING NEW SOUTH WALES We hereby declare that to the best of our knowledge and belief, during the financial year ended 30 June 2012 there have been no: (i) (ii) contraventions of auditor independence requirements in relation to the audit and contraventions of any applicable code of professional conduct in relation to the audit. KS Black & Co Chartered Accountants Faizal Ajmat Partner Level 1, 460 Church Street North Parramatta NSW 2151 Dated: 27 September

51 INDEPENDENT AUDIT REPORT FOR GREYHOUND RACING NEW SOUTH WALES Report on the Financial Report We have audited the accompanying financial report of Greyhound Racing New South Wales, which comprises of the statement of financial position as at 30 June 2012, and the statement of comprehensive income, statement of changes in equity and statement of cash flow for the year ended on that date, a summary of significant account policies and other explanatory notes and the declaration by members of the Board as set out on pages 35 to 47. Responsibility for the Financial Statements The Board of Greyhound Racing New South Wales are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including Australian Accounting Interpretations) and the financial reporting requirements of the entity s constitution. This responsibility includes establishing and maintaining internal control relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditor s Responsibility Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. The Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement. An audit involved performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor s judgement, including the assessment of risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. And audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Independence In conducting our audit, we have complied with the independence declaration requirements of the Australian professional ethical pronouncements. 49

52 NOTES TO THE FINANCIAL STATEMENTS INDEPENDENT AUDIT REPORT FOR GREYHOUND RACING NEW SOUTH WALES (continued) Auditors Opinion In our opinion the financial report of Greyhound Racing New South Wales is in accordance with the entity s constitution and (i) (ii) gives a true and fair view of the entity s financial position as at 30 June 2012 and of its performance of the year ended in that date; and complies with Australian Accounting Standards (including Australian Accounting Interpretations) and the entity s constitution. KS Black & Co Chartered Accountants Faizal Ajmat Partner Level 1, 460 Church Street North Parramatta NSW 2151 Dated: 27 September

53 NOTES 51

54 NOTES 52

55 NOTES 53

56 Greyhound Racing NSW Head Office Building B, 1 Homebush Bay Drive Rhodes NSW 2138 Tel: Fax: Postal Address: PO Box 170 Concord West NSW admin@grnsw.com.au Web: Auditors KS Black & Co Level Church Street North Parramatta NSW 2151 Solicitors Clayton Utz Level 15 1 Bligh Street Sydney NSW 2000 Bankers Commonwealth Bank of Australia 1-3 Auburn Road Auburn NSW 2144 IBC

57 ABN Building B, 1 Homebush Bay Drive, Rhodes NSW 2138 Australia Tel Fax Web.