Calder Drops to Last in Host Track Business
Aug 29, 2013 21:35:42 GMT -5
Post by Jon on Aug 29, 2013 21:35:42 GMT -5
More bad news for Calder. Will they survive, close or sell to Frank the Bank?
(I posted entire article for those that maybe don't understand Hosting)
Calder Drops to Last in Host Track Business
By Jim Freer
Calder Casino & Race Course came in last among Florida's three Thoroughbred tracks in July in the lucrative business of host track simulcasting of races from Thoroughbred tracks outside the state.
In previous Julys, Calder was the only Florida track holding a race meet and thus the only one eligible to be a host and retransmit Thoroughbred simulcast signals to other Florida pari-mutuels that are known as guest tracks.
But amid new host track competition from Gulfstream Park and Tampa Bay Downs, The Blood-Horse estimates that Calder's pre-tax revenues from that wagering on tracks such as Belmont Park and Santa Anita Park fell from about $3 million in July 2012 to about $550,000 in July 2013 (details below).
A host track must put half of that revenue into race purses, while using the remainder for other purposes.
Florida has 32 pari-mutuel facilities including the three Thoroughbred tracks.
During July 2013, Tampa Bay was first and Gulfstream was second in providing signals for wagering at guest tracks that totaled $17,010,964, according to data released Aug. 28 by the Florida Division of Pari-Mutuel Wagering.
Here is the breakdown for July 2013:
*Tampa Bay Downs (Oldsmar, Fla.)-- $7,162,855, for 42% of the total;
*Gulfstream (Hallandale Beach, Fla,.)-- $5,532,761, for 32 % of the total;
*Calder (Miami Gardens, Fla.) -- $4,315,347, for 26% of the total.
Guest track wagering was listed as $23,050,325 in July 2012, with Calder providing all of it.
The July-to-July decline in the total number can be attributed to the $7,285,601 that was bet at Gulfstream and the $1,886,5218 bet at Tampa Bay in July 2013 on out-of-state simulcasts. In previous Julys the two tracks received those signals from Calder as guest tracks.
Without the new competition Calder probably would have supplied more than $25 million in guest track business and generated more than $3 million in revenues on it in July 2013, similar to the previous July,
The new Florida DPMW data help explain why Calder announced Aug. 25 that it would cut daily average overnight purses by 12% beginning Aug. 30.
Calder said it is making that change due to the impact of the host track competition and of its new weekend head-to-head racing with Miami-area neighbor Gulfstream.
Since the middle of May 2013, the three tracks have been operating as year-round host tracks, using their different interpretations of Florida laws.
They are competing for market share where combined revenues for the three tracks are between $30 million and $40 million a year—with half of that going into purses.
It is widely viewed that the outcome could be significant in determining the longterm health and growth prospects of the three tracks.
The host track numbers for this July are a continuation of a troublesome trend for Calder.
On July 31, Calder's parent, Churchill Downs Inc., reported that Calder revenue and earnings before interest, taxes, depreciation, and amortization declined $5.1 million in this year's second quarter compared with the same period in 2012 "due to the impact of multiple host racetracks."
Since July 6, Calder and Gulfstream, which are just eight miles apart, have been racing head-to-head on Saturdays and Sundays.
Through eight weekends, Gulfstream has averaged about $2.5 million a day in all-sources handle compared with about $1.25 million for Calder.
Despite the host track and on-track numbers, Calder officials said reiterated Aug. 29 that the track does not plan to change its schedule, which calls for it to have racing Fridays through Sundays until June 30, 2014.
Host Track Rules
Under Florida laws, a Thoroughbred track can be eligible to be a host only if it is holding what the Florida DPMW regards as a live race meet. A host purchases the signals of Thoroughbred tracks outside Florida and then sells and transmits them to other Florida pari-mutuels.
In the Aug. 25 announcement, Calder vice president and general manager for racing John Marshall said: "Historic qualification for a live race meet only allowed simulcasting during a live meet which consisted of three live race days a week."
Gulfstream is now racing year-round at least two days a week, and it maintains that it meets contiguous weeks' racing requirements for host track eligibility.
Tampa Bay's interpretation has created some controversy, and the track's general manager, Peter Berube, notes that "some people are depicting us the bad guy."
He provided details to refute that view, and explain why Tampa Bay believes it is host track-eligible.
Berube pointed to a provision of state law that allows a track to conduct any type of simulcasting if, during the preceding fiscal year, it raced for a period of at least 40 days with at least three racing days a week.
Tampa Bay did that during its 2012-13 meet from early December through early May.
It stirred controversy by holding a two-day meet June 30 and July 1, to help assure it could have year-round host track status for 2012-13 and for 2013-14.
Tampa Bay's next race day will be Dec 4.
Berube would not identify the pari-mutuels that are receiving Tampa Bay's host track signals of non-Florida tracks. But he said that list is the same as during its regular race meets.
He estimates that year-round host simulcasting will lead to a $1.8 million to $2 million increase in purses for Tampa Bay's 2013-14 meet. That would be a 15% hike with an average of about $22,000 per day over 91 days.
"This is money for our horsemen (Tampa Bay Horsemen's Benevolent and Protective Association)," Berube said. "It helps level the playing field with Calder and Gulfstream, which have some purse money coming from slot machines, something we don't have,"
Kent Stirling, executive director of the Florida Horsemen's Benevolent and Protective Association said: "What Tampa Bay is doing is totally bogus. It was never the intention of the legislature to let a track go 150 days between races and still consider it a race meet."
The Florida HBPA has purse contracts with Calder and Gulfstream.
"The majority of the horsemen at Tampa Bay spend the rest of the year at tracks in other states," Stirling said. "What Tampa Bay is doing is taking purse money away from our horsemen who live and race in Florida year-round,"
Calder in late May filed a petition with the Florida Division of Administrative Hearings asking it to determine whether the Florida DPMW violated Florida laws and rules by allowing Gulfstream and Tampa Bay to be host tracks during periods other than their traditional race meets.
The Division of Administrative Hearings has told the Florida DPMW to conduct the review, with a decision due by the end of September.
Marshall said Calder hopes the Florida DPMW will revoke the year-round host-track status of Tampa Bay and Gulfstream or not grant it for 2014-15.
Host Track Numbers
Guest-track wagering was $270 million during Florida's 2011-12 fiscal year that ended June 30, 2012. It declined to $262 million in 2012-13. Calder's market share fell from 71% in fiscal 2011-12 to 65% in 2012-13.
The host tracks generally do not disclose their revenue and profitability for that business. But it is known to be profitable and is sometimes referred to as a cash cow, partly because of the relatively low cost of ongoing operations.
State law requires that the guest track receive at least one-third of takeout, with the remainder divided evenly between the host track and the horsemen's association with which it has a purse contract.
The host track expenses are for paying a non-Florida track to take its signal and for ongoing operations.
Based on an assumed 20% blended takeout of $270 million in wagering, the guest and host tracks had combined revenues of about $54 million in each of the last two fiscal years. Of that money, the tracks would divide as much as $36 million.
That breakdown indicates why Calder apparently had about $3 million in revenue on $23 million in guest track wagering in July 2012, and about $550,000 in revenue on $4.3 million of that wagering this July,
Calder and Gulfstream cannot be the host track for any of the three pari-mutuels within 50 miles of Tampa Bay Downs, and Tampa Bay Downs cannot be the host for the other six pari-mutuels within 50 miles of Gulfstream or Calder.
Berube said that Tampa Bay in recent years has allowed some guest track clients to keep slightly more than one-third of takeout, but that it has not become more aggressive on pricing this year.
Gulfstream has offered higher takeouts and gained year-round business from several pari-mutuels that have been its guest track clients during its regular winter meets, said the track's president, Tim Ritvo.
Without providing pricing details, he said that Palm Beach Kennel Club in West Palm Beach, one of Florida's most active sites for simulcast betting, is among the guest tracks Gulfstream has taken away from Calder this summer.
(I posted entire article for those that maybe don't understand Hosting)
Calder Drops to Last in Host Track Business
By Jim Freer
Calder Casino & Race Course came in last among Florida's three Thoroughbred tracks in July in the lucrative business of host track simulcasting of races from Thoroughbred tracks outside the state.
In previous Julys, Calder was the only Florida track holding a race meet and thus the only one eligible to be a host and retransmit Thoroughbred simulcast signals to other Florida pari-mutuels that are known as guest tracks.
But amid new host track competition from Gulfstream Park and Tampa Bay Downs, The Blood-Horse estimates that Calder's pre-tax revenues from that wagering on tracks such as Belmont Park and Santa Anita Park fell from about $3 million in July 2012 to about $550,000 in July 2013 (details below).
A host track must put half of that revenue into race purses, while using the remainder for other purposes.
Florida has 32 pari-mutuel facilities including the three Thoroughbred tracks.
During July 2013, Tampa Bay was first and Gulfstream was second in providing signals for wagering at guest tracks that totaled $17,010,964, according to data released Aug. 28 by the Florida Division of Pari-Mutuel Wagering.
Here is the breakdown for July 2013:
*Tampa Bay Downs (Oldsmar, Fla.)-- $7,162,855, for 42% of the total;
*Gulfstream (Hallandale Beach, Fla,.)-- $5,532,761, for 32 % of the total;
*Calder (Miami Gardens, Fla.) -- $4,315,347, for 26% of the total.
Guest track wagering was listed as $23,050,325 in July 2012, with Calder providing all of it.
The July-to-July decline in the total number can be attributed to the $7,285,601 that was bet at Gulfstream and the $1,886,5218 bet at Tampa Bay in July 2013 on out-of-state simulcasts. In previous Julys the two tracks received those signals from Calder as guest tracks.
Without the new competition Calder probably would have supplied more than $25 million in guest track business and generated more than $3 million in revenues on it in July 2013, similar to the previous July,
The new Florida DPMW data help explain why Calder announced Aug. 25 that it would cut daily average overnight purses by 12% beginning Aug. 30.
Calder said it is making that change due to the impact of the host track competition and of its new weekend head-to-head racing with Miami-area neighbor Gulfstream.
Since the middle of May 2013, the three tracks have been operating as year-round host tracks, using their different interpretations of Florida laws.
They are competing for market share where combined revenues for the three tracks are between $30 million and $40 million a year—with half of that going into purses.
It is widely viewed that the outcome could be significant in determining the longterm health and growth prospects of the three tracks.
The host track numbers for this July are a continuation of a troublesome trend for Calder.
On July 31, Calder's parent, Churchill Downs Inc., reported that Calder revenue and earnings before interest, taxes, depreciation, and amortization declined $5.1 million in this year's second quarter compared with the same period in 2012 "due to the impact of multiple host racetracks."
Since July 6, Calder and Gulfstream, which are just eight miles apart, have been racing head-to-head on Saturdays and Sundays.
Through eight weekends, Gulfstream has averaged about $2.5 million a day in all-sources handle compared with about $1.25 million for Calder.
Despite the host track and on-track numbers, Calder officials said reiterated Aug. 29 that the track does not plan to change its schedule, which calls for it to have racing Fridays through Sundays until June 30, 2014.
Host Track Rules
Under Florida laws, a Thoroughbred track can be eligible to be a host only if it is holding what the Florida DPMW regards as a live race meet. A host purchases the signals of Thoroughbred tracks outside Florida and then sells and transmits them to other Florida pari-mutuels.
In the Aug. 25 announcement, Calder vice president and general manager for racing John Marshall said: "Historic qualification for a live race meet only allowed simulcasting during a live meet which consisted of three live race days a week."
Gulfstream is now racing year-round at least two days a week, and it maintains that it meets contiguous weeks' racing requirements for host track eligibility.
Tampa Bay's interpretation has created some controversy, and the track's general manager, Peter Berube, notes that "some people are depicting us the bad guy."
He provided details to refute that view, and explain why Tampa Bay believes it is host track-eligible.
Berube pointed to a provision of state law that allows a track to conduct any type of simulcasting if, during the preceding fiscal year, it raced for a period of at least 40 days with at least three racing days a week.
Tampa Bay did that during its 2012-13 meet from early December through early May.
It stirred controversy by holding a two-day meet June 30 and July 1, to help assure it could have year-round host track status for 2012-13 and for 2013-14.
Tampa Bay's next race day will be Dec 4.
Berube would not identify the pari-mutuels that are receiving Tampa Bay's host track signals of non-Florida tracks. But he said that list is the same as during its regular race meets.
He estimates that year-round host simulcasting will lead to a $1.8 million to $2 million increase in purses for Tampa Bay's 2013-14 meet. That would be a 15% hike with an average of about $22,000 per day over 91 days.
"This is money for our horsemen (Tampa Bay Horsemen's Benevolent and Protective Association)," Berube said. "It helps level the playing field with Calder and Gulfstream, which have some purse money coming from slot machines, something we don't have,"
Kent Stirling, executive director of the Florida Horsemen's Benevolent and Protective Association said: "What Tampa Bay is doing is totally bogus. It was never the intention of the legislature to let a track go 150 days between races and still consider it a race meet."
The Florida HBPA has purse contracts with Calder and Gulfstream.
"The majority of the horsemen at Tampa Bay spend the rest of the year at tracks in other states," Stirling said. "What Tampa Bay is doing is taking purse money away from our horsemen who live and race in Florida year-round,"
Calder in late May filed a petition with the Florida Division of Administrative Hearings asking it to determine whether the Florida DPMW violated Florida laws and rules by allowing Gulfstream and Tampa Bay to be host tracks during periods other than their traditional race meets.
The Division of Administrative Hearings has told the Florida DPMW to conduct the review, with a decision due by the end of September.
Marshall said Calder hopes the Florida DPMW will revoke the year-round host-track status of Tampa Bay and Gulfstream or not grant it for 2014-15.
Host Track Numbers
Guest-track wagering was $270 million during Florida's 2011-12 fiscal year that ended June 30, 2012. It declined to $262 million in 2012-13. Calder's market share fell from 71% in fiscal 2011-12 to 65% in 2012-13.
The host tracks generally do not disclose their revenue and profitability for that business. But it is known to be profitable and is sometimes referred to as a cash cow, partly because of the relatively low cost of ongoing operations.
State law requires that the guest track receive at least one-third of takeout, with the remainder divided evenly between the host track and the horsemen's association with which it has a purse contract.
The host track expenses are for paying a non-Florida track to take its signal and for ongoing operations.
Based on an assumed 20% blended takeout of $270 million in wagering, the guest and host tracks had combined revenues of about $54 million in each of the last two fiscal years. Of that money, the tracks would divide as much as $36 million.
That breakdown indicates why Calder apparently had about $3 million in revenue on $23 million in guest track wagering in July 2012, and about $550,000 in revenue on $4.3 million of that wagering this July,
Calder and Gulfstream cannot be the host track for any of the three pari-mutuels within 50 miles of Tampa Bay Downs, and Tampa Bay Downs cannot be the host for the other six pari-mutuels within 50 miles of Gulfstream or Calder.
Berube said that Tampa Bay in recent years has allowed some guest track clients to keep slightly more than one-third of takeout, but that it has not become more aggressive on pricing this year.
Gulfstream has offered higher takeouts and gained year-round business from several pari-mutuels that have been its guest track clients during its regular winter meets, said the track's president, Tim Ritvo.
Without providing pricing details, he said that Palm Beach Kennel Club in West Palm Beach, one of Florida's most active sites for simulcast betting, is among the guest tracks Gulfstream has taken away from Calder this summer.
