CONTENT 1 Fintoto Oy today 2 Finnish equine industry 3 Trotting sport and Toto betting in Finland 4 The way forward
1 FINTOTO IS A RENEWED FINNISH HORSE BETTING COMPANY Fintoto is a renewed, modern and agile Finnish horse race betting company with a mission to organize Toto betting responsibly and efficiently and convert betting turnover into funds for horse breeding and trotting sport in Finland. FINTOTO S RESPONSIBILITIES Selling and marketing Toto betting Developing pari-mutuel betting systems at the racetracks and outside the tracks International collaboration with other horse race betting companies Broadcasting trotting races on national TV channels Trotting race broadcasts on Fintotoowned TotoTV channel FINTOTO OY IS A FULLY OWNED SUBSIDIARY OF HIPPOS RY Suomen Hippos ry is the Finnish trotting and breeding association with 131 member organizations 4
1 THREE BETTING MONOPOLIES IN FINLAND RAY SLOT MACHINE ASSOCIATION Slot machine and casino betting VEIKKAUS Football pools, betting and money lottery FINTOTO Horse betting 5
1 KEY FIGURES 2015 Turnover EUR 230 million (231.3) About 37 employees EUR 31,7 million of the betting turnover converted into funds for horse breeding and trotting sport in Finland 6
1 OPERATING ENVIRONMENT Competition in the betting market has changed and become more diverse. The customers are demanding more and more from betting companies. Consumer behavior is changing. Betting is moving to a digital environment and the number of new terminals and betting platforms is growing, making betting an entertainment no longer reliant on time or place. International competition is becoming tougher. The growing, international offering targets Finland as well, the offering is becoming more diverse and the pace of renewal accelerates, giving rise to a state of constant change. With a monopoly status, Fintoto s responsibility of the consumers is increasingly important with international competition. 7
1 FINTOTO IS PART OF FINNISH EQUINE INDUSTRY FINTOTO OY Betting company with a mission to organize Toto betting responsibly and efficiently and convert betting turnover into funds for horse breeding and trotting sport in Finland Subsidiary of Suomen Hippos ry SUOMEN HIPPOS RY Finnish trotting and breeding association Keeps a register and a pedigree book of horse breeds bred in Finland Manages and monitors trotting race activity in Finland Practices training, association and publication activities SUOMEN HEVOSURHEILULEHTI OY Main media of equestrian sports and trotting in Finland Subsidiary of Suomen Hippos ry HEVOSTALOUS OY Produces the financial administration services required by racetracks cost-efficiently Established and owned by 12 tracks and Suomen Hippos ry RACETRACKS Regional event center, which organizes and markets trotting sport events to the public Tracks operate as independent companies or associations 8
1 FINTOTO S MISSION AND OPERATING METHOD MISSION Fintoto s mission is to organize Toto betting responsibly and efficiently and convert betting turnover into funds for horse breeding and trotting sport in Finland. OPERATING METHODS We put the customer at the center in all our operations. We have an efficient process to bring in new customers and to manage existing ones. Our business processes are simple and cost-efficient. Management and decision-making are based on information. Our corporate culture is built on analytical team work and optimal openness. 9
1 EFFICIENT ORGANIZATION An efficient organization is in charge of running the betting activities of more than 2000 betting targets, 363 days a year. Maintenance and development of online and mobile services. Advanced and extensive TV production. Organizing, selling and marketing betting pools. 10
1 SOCIAL RESPONSIBILITY IS THE CORNERSTONE OF FINTOTO S BUSINESS Fintoto s special social mission is to organize Toto betting responsibly and efficiently and convert betting turnover into funds for horse breeding and trotting sport in Finland. Themes important to Fintoto s business and stakeholders are: Complying with the obligations of a betting monopoly Organizing betting pools responsibly Fintoto s responsibility as an employer Good corporate governance in all company operations Horse life cycle and the equine industry as part of Finnish society 11
2 EQUINE INDUSTRY OFFERS JOBS The trotting world and Toto betting form an extensive financial ecosystem in the value chain affecting Finland s well-being. A horse employs 15,000 people Finland has around 3,000 equine industry companies Around EUR 830 million committed to events, stables and betting Trotting races see around 670,000 visitors a year Finland has 74,000 horses with up to 200,000 people actively and diversely partaking in equine activities Trotting sport is a strongly regional activity the equine industry affects the economical well-being of the countryside directly and indirectly Equestrian and trotting sports have grown in recent decades 13
2 DIVISION OF FUNDS ACCUMULATED THROUGH TOTO BETTING IN 2015 MMM stands for the Finnish Ministry of Agriculture and Forestry 14
2 HORSE RACE BETTING ACCUMULATION EUR million Veikkaus horse race betting Toto betting Source: Suomen Hippos ry 15
3 DID YOU KNOW? Trotting races are held 363 days a year Trotting events had around 670,000 visitors in 2015 After ice hockey, trotting is the second most watched sport in Finland 4978 Toto races in Finland in 2015 Finland has around 160 professional coaches and 7,000 amateur coaches Finland is included among the four biggest trotting countries in Europe Europe s biggest trotting countries are France and Sweden 17
3 HISTORY OF TROTTING RACES AND TOTO BETTING IN FINLAND 1817 1865 1884 1919 1928 1924 First races in Turku on the frozen Aurajoki river. State begins to support racing and establishes so-called state races. However, racing has more of a breeding aim than a sport aim. Private trotting clubs established. First track on land is completed in Helsinki s Oulunkylä. Leading trotting clubs establish Suomen Ravirengas as the sport s main association. Finnhorse Trotting Championship begins in Lahti. Parimutuel betting starts, first betting races on the ice of Helsinki s Pohjoissatama. However, weak betting terms cause parimutuel betting to fade. 1979 1977 1973 1965 1957 Finnhorse Trotting Champion Vieteri the first horse to reach a million marks in winnings. With warmbloods, the stallion Einarsin reaches the same milestone in 1986. Charme Asserdal begins a successful international career. Popularity of trotting sport grows. Vermo track completed in Helsinki. Horse breeding and trotting associations unite to form Suomen Hippos ry. Parimutuel betting regulation changed to be more favorable to bettors and betting pool turnovers begin to grow. The sport develops and becomes modern faster and faster. President Urho Kekkonen gifted with the warmblood mares Suosikki and Kaunotar and the stallion Lento by the government of the Soviet Union. 1982 1990 1995 2001 2002 2012 National V5 parimutuel betting moved to Oy Veikkaus Ab. Track race betting stays with Suomen Hippos. Yearly turnover of track betting approaches one billion marks. Suomen Hippos starts parimutuel betting at Totoline locations outside tracks. National V5 parimutuel betting at Vermo begins. Hippos corporatizes parimutuel betting activity. Fintoto Oy begins operations on January 1, 2001. Fintoto s online betting system opens September 19, 2002. All horse race betting moved under Fintoto January 1, 2012. 18
3 RACETRACKS Trotting sport is a strongly regional activity with a long history. There are altogether 43 tracks in Finland. In addition to the main track Vermo, there are 19 county tracks and 23 summer tracks. MAJOR EVENTS OF THE YEAR Finnhorse Trotting Championship Finlandia-ajo, Vermo Kymi GP, Kouvola Suur-Hollola, Lahti St. Michel, Mikkeli Suuri Suomalainen Derby, Vermo Kriterium, Tampere Nordic King, Härmä Main track County tracks Summer tracks www.toto.fi 19
3 MULTI-CHANNEL BETTING EXPERIENCE FOR THE CONSUMER We are developing our operations and services to be independent of channels. The multi-channel nature of our services, sufficient availability of horse betting and the reliability of our betting services are the basis of all our betting operations. Our company is a modern user of digital business, services and betting on all channels. TOTO S EVOLUTION First, consumers placed their bets at tracks and, after, also at remote betting locations A single experience from a single physical location The consumer has access to several channels, which operate independently Fintoto s channel understanding and operations located in technical and functional silos The consumer has access to several channels all part of the same Toto brand Fintoto has a single view of online customers but operations are in functional silos Consumers experience one Toto not just channels Different sales locations can use the overall customer picture in a coordinated and strategic way The consumer is offered an omni-channel experience 20
3 WHERE IS TOTO AVAILABLE? AT THE TRACK: Finland has 43 racetracks ONLINE: Almost 60% of Toto bets are placed online MOBILE: Fintoto s awardwinning mobile application TOTO LOCATIONS: Fintoto Oy has around 1,000 parimutuel betting locations www.toto.fi 21
3 MORE THAN HALF OF PARIMUTUEL BETTING SOLD ONLINE Track betting EUR 13.6 million Track to track EUR 1.6 million EUR 229.8 million in total Online betting EUR 135.5 million Source: Suomen Hippos ry Toto betting locations EUR 79.1 million 22
3 TOTO BRANDS 2016 The most popular parimutuel betting option is Kaksari where you bet on the first two horses to cross the finishing line. The finishing order does not matter. The smallest bet is 1. The return percent is 79%. www.toto.fi 23
3 FINTOTO ALSO OFFERS INTERNATIONAL BETTING TARGETS Internationalization is an important factor for Fintoto s growth In addition to Finland, Fintoto offers interesting betting targets in Sweden, France, South Africa and Great Britain Betting targets consist of daily trotting and flat racing around the world Betting organized in collaboration with the target country to create larger exchange and through it bigger winnings 24
4 FINTOTO IS A COMPANY IN THE PROCESS OF RENEWING ITSELF Horse race betting on mobile Internationality and growth opportunities The industry collaborates Increasing the visibility of trotting sport Reaching new bettor target groups Collaboration with MTV Media started in the beginning of 2015 26
More information: Pertti Koskenniemi CEO Tulkinkuja 3, FI-02650 Espoo Switchboard: +358 (0)20 760 500 Mobile: +358 400 512196 pertti.koskenniemi@fintoto.fi www.fintoto-oy.fi