Pulling the punters' dollars in

Lindsay Fergusson (left), Jim Patterson (centre) and Chris Weaver are looking to lift their clubs' fortunes. Picture / Martin Sykes

The horses are running hot for the region's two premier racing clubs.

The Auckland Racing Club (ARC) is in the running for a $750,000 financial turnaround in the year to July 31, and the Auckland Trotting Club (ATC) expects to beat last year's record profit of $1 million.

This strong form isn't because Aucklanders have found a renewed passion for the tote, as TAB income is just part of the clubs' growing revenues.

What has changed is the quality of ideas for parting racegoers from their money.

Both clubs are headed by chief executives with strong marketing pedigrees and a short acquaintance with racehorses.

But Auckland's other track, run by the Avondale Jockey Club, is running a distant third. Lacking the clout of its rivals, it is stuck holding race meetings mid-week, when it will never attract the big crowds.

It is now looking at property development as a means of keeping the facility on the pace.

At Ellerslie, home of the ARC, some sacred traditions are being sent to the knacker's yard. From next year, the Auckland Derby and Auckland Cup will no longer be held on Boxing Day and New Year's Day respectively. They are being shifted to the first week in March.

"You tell me how many corporates are going to take a marquee on Boxing Day to entertain clients when most people have gone on holiday to the Coromandel?" said ARC chief executive Chris Weaver.

But the former Lion Breweries marketing executive and his board are still trailing those creating trotting and pacing excitement at Epsom's Alexandra Park.

The ATC has been much quicker to grasp the fact that the racing's future depends on providing all-round entertainment and a sense of occasion, not just a betting venue.

And ATC, the most profitable racing club in the country, has no intention of taking a breather after its success last month hosting Australasia's greatest harness-racing festival, the Interdominions, said chief executive Lindsay Fergusson, a former America's Cup Village chairman and marketing veteran who's been in the job 18 months.

More than 20,000 people came to the festival, many first-time racegoers. A big pitch to young people (they had their own marquee and a band laid on) paid off.

More than half ATC's annual earnings are from non-racing activities. Its 16ha of prime Epsom land is a big rental earner. It has the country's only 24-hour racing club licence for a function centre, sports bar and cafe, with gaming machines, and the club leases space to a Chinese restaurant, service station, Burger King, and for car parking.

Shortly, the city council will publicly notify the club's application for a 1.7ha residential and commercial development on Greenlane Rd. The club will get ground lease income and a share of the developer's profit.

Fergusson said the higher ATC's income, the more it could plough back into race prize money or stakes, and upgrading amenities. The higher the stakes, the healthier the harness racing industry.

The stake is the dividend for owners and trainers who invest money and time in what is a no-guarantees business. Higher stakes also attract higher-quality horses.

ATC paid $5 million in stakes in the 2003-04 financial year. That's one third more than it gets in TAB revenue, and the highest payout of any club in the country.

The club has no debt. It has just spent $250,000 upgrading audio-visual systems to digital, and most of its televisions are plasma screens.

"People aren't going to come for facilities that aren't as good as in their lounges at home," Fergusson said.

He'll only take credit for introducing a three-year business plan. He said he inherited a strong management team which agreed that the racing club should be run as a business.

ARC's Weaver, on the other hand, can probably take credit for just about everything his shake-up of Ellerslie achieves.

His activities are backed by a new board with a strong business flavour. It replaced a regime that allowed Ellerslie to grow cobwebs while the punters found new sport at the Viaduct or SkyCity casino. When Weaver arrived there was just one computer with internet access.

The ARC lost $452,000 last year and the priority was for it to break even this financial year, but if everything goes to plan it will post a profit of around $250,000 in July.

More significantly, the club hopes to be able to offer an extra $1 million in stakes in the next 15 months. It has no significant debt and at least $10 million in capital reserves.

There will be no more land sales. But Ellerslie is putting part of its 55ha estate, valued at $70 million, to use for lease income. A multimillion-dollar commercial and housing development is planned on 2ha.

Meanwhile, Weaver is throwing his energies into Ellerslie's convention centre. The rundown centre earned $500,000 a year for the past four years, he says.

"We are on track to double the contribution from that this year and the potential for growth is fantastic."

The club has spent nearly $4 million upgrading facilities, including kitchen gear "so chefs can do their jobs".

The grey-haired are the mainstay of Ellerslie - until recently most of its 1400 members were "well and truly over 60".

But now young visitors are being spotted. The new "Whips n Spurs" is a venue for "20s and 30-somethings" who can play all day at Ellerslie then go nightclubbing.

This is not rocket science, said Weaver, who has replaced the management team.

It's about giving visitors a quality experience and value for their dollar.

Weaver's not just a hired gun. He's passionate about lifting Ellerslie stakes for the good of the thoroughbred industry, and enforcing its claim as New Zealand's "premier" racing site.

And he's making some controversial changes in the process.

From next year the Auckland Derby will kick off a new racing carnival in the first week of March. There will be the Derby on Saturday, the Auckland Cup on the Wednesday and then the New Zealand Stakes and the Sires Produce group-one races.

Weaver said Auckland was "desperate" for an event with the loss of the America's Cup.

Moving the events is the "single biggest thing to happen in New Zealand in the last 30 years".

It is also a "slightly risky" strategy, said ATC's Fergusson. He wished Weaver well in his mission but questioned Weaver's enthusiasm for launching an Auckland sporting "destination" weekend in March.

Weaver is suggesting Friday night at the trots, Saturday racing at Ellerslie, a Blues game on Saturday night and Sunday with the Warriors.

Fergusson said the Interdominions rotate around Australasia, therefore the best harness-racing horses could be anywhere but Alexandra Park in March.

Does vamping up Ellerslie include raising membership fees?

"We haven't, yet," Weaver said.

It costs nearly $2 million to open the gates of Ellerslie each year. Costs include insurance, salaries, electricity, depreciation, security, catering, printing and the army of specialists that have to attend any race meeting.

Weaver's team has cut those costs by up to 15 per cent but "there's a lot to go".

The resurrection of Ellerslie will not extend to combination meetings with harness racing. But for the Avondale Jockey Club, an annual combined 17-race meeting with the Kumeu District Trotting Club is essential business.

Avondale is a mid-week business, racing mainly on Wednesdays. It gets about 2000 visitors on a Wednesday and up to 5000 on cup day.

Avondale made a profit on racing activities of $294,000 last year. Overall though, the business made a loss - of nearly $104,000 before depreciation, and $281,604 including depreciation. Part-time chief executive Jim Patterson said the club would also like to raise its stakes, but it had "very little" in capital reserves. It costs the club up to $85,000 to open its gates on a Wednesday. A weekend meeting can cost up to $150,000.

But Avondale is also land-rich. It generates about $550,000 a year from rental activities including housie evenings and the weekend markets.