Strong boost projected in TAB NZ’s community distributions

2 July 2021
TAB NZ is projecting a significant increase in distributions to the community in the next financial year, providing a major boost to both racing and sport in New Zealand.

One of the key legislative objectives of TAB NZ is to maximise profits for the New Zealand racing industry, and returns to New Zealand sport. Next year, the three racing codes - New Zealand Thoroughbred Racing (NZTR), Harness Racing New Zealand (HRNZ) and Greyhound Racing New Zealand (GRNZ) - are projected to receive $23 million more in fixed distributions compared to that budgeted for the current financial year, at a total of $140m. This increase equates to a 20 percent rise in growth year-on year (see Table 1 below).

Total distributions to New Zealand sport are also set to increase with a projected total of $19.7m across the next financial year, up $3.6m on this year’s budget, or 23 percent (see Table 2 below). This is subject to the regulations that will determine sport distributions being finalised. 

Due to the unique economic environment TAB NZ is currently operating in, projected distributions, not paid on an actual basis, will be reviewed quarterly during the year to ensure they are aligned with actual trading performance.

A number of factors have contributed to the TAB being able to provide this projected boost in distributions. These include strong financial performance across the current financial year, disciplined cost management on the back of a change in organisational direction and restructuring in 2020, and revenue uplift from improved margin performance and increased product availability.

Finalisation of the racing reform programme has also played a key role, delivering racing Betting Information Use Charges (BIUC), which are estimated to be worth $20m for the next financial year. The Government’s repeal of the Betting Levy is also expected to deliver $10m in FY21/22 for racing. Total distributions to the racing codes (BIUC, Betting Levy and Fixed Distributions) could top $170m next year, an increase of over $31m or 23 percent on this year’s budget. 

The projected addition of funding to thoroughbred racing is also a further step towards one of the last Messara Report recommendations being achieved, with recommendation number 17 being to ‘increase thoroughbred prizemoney gradually to over $100 million per annum’. 

Sport will also get a boost next year, through increased projected commissions from the TAB and the new sports BIUC regime. The repeal of the betting levy is also expected to deliver $3.9m to sport next year.

Chief Transition Officer, Dean McKenzie, said the TAB is thrilled with the projected increase in distributions to racing and returns to sport.

“It’s great that we’re in a position to increase our returns to the community in the next financial year. 

Last year was a challenge for all of us and like many, our organisation went through a lot of change, but we’re now seeing the positive returns from the investment made by the Government and the industry in the TAB.

We’re excited with where we are heading and incredibly proud that significant tangible benefits from all the hard work over the last two or three years are now starting to flow to both racing and sport in New Zealand.”

Table 1 - Projected Racing Distributions

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Table 2 - Projected Sport Distributions

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