Hong Kong Jockey Club Returns Record HK$29.4 Billion to the Community in 2020/21

September 3, 2021 | Financial

HONG KONG, SAR (August 31, 2021) — The Hong Kong Jockey Club announced today (31 August) its results for the 2020/21 financial year ended 30 June 2021. Despite a challenging year, the Club set a new turnover record of HK$279.7 billion, enabling it to make a significant return to the community of HK$29.4 billion. This included a record HK$24.9 billion to the Government in duty, profits tax and Lotteries Fund contributions, and HK$4.5 billion in approved charity donations.

New Steward elected

At its Annual General Meeting (“AGM”) today (31 August), chaired by Chairman Mr Philip Chen, the Club’s Voting Members elected one new Steward and re-elected four Stewards to the Board of Stewards.

Mr Andrew W B R Weir MBE JP was elected to a one-year term to fill the vacancy left by Mr Stephen Ip Shu Kwan GBS JP who resigned from the Board as he will reach the age of 70 shortly after the AGM. Mr Michael T H Lee JP, Mr Richard Tang Yat Sun SBS JP, Mr Nicholas D Hunsworth and Dr Henry H L Chan were re-elected to serve a term of three years each.

Following the AGM, the new Board of Stewards re-elected Mr Philip N L Chen GBS JP as Chairman and Mr Michael T H Lee JP as Deputy Chairman for 2021/22.

Mr Andrew Weir (detailed biography attached) joined the Club as a Full Member in 1997 and became a Voting Member in 2015. He is a member of the Eighth Floor Syndicate whose horses include First Knight and Clear Choice. Mr Weir is a Chartered Accountant and currently holds senior leadership positions with KPMG at regional and global level. He is a Fellow and Council Member of The Hong Kong Institute of Directors and a Council Member of the Hong Kong Trade Development Council.

Racing forward together

The past year was one of the most challenging in the history of the Club. Nonetheless, the Club was determined to fulfil its commitment to the betterment of society. In particular it provided much-needed racing entertainment and maintained strong tax and charity support for the community.

Guiding the Club throughout have been the principles it established from the beginning of the pandemic, namely that nothing it does should create a public health risk and nothing should put the health and safety of the Club’s employees and customers at risk. Accordingly, and in response to various waves of the pandemic, the Club limited racecourse attendance and closed or provided limited services at Off-Course Betting Branches and Telebet.

But racing never stopped. Thanks to its protective “racing bubble” the Club raced on, with not a single race lost. This included the LONGINES Hong Kong International Races and FWD Champions Day featuring top overseas horses and jockeys. The former was the only international sporting event in Hong Kong in 2020, while both earned recognition for Hong Kong around the world.

The Club’s success also ensured that Hong Kong races and horses continued to rank highly internationally. Nine of Hong Kong’s 12 Group 1 races were in the World’s Top 100 for 2020 and 17 horses in the LONGINES World’s Best Racehorse Rankings, including Golden Sixty, the world’s number three miler. Homegrown jockey Vincent Ho’s five international Group 1 wins saw him spend two months at the top of the LONGINES World’s Best Jockey rankings in joint first place.

The Club would like to thank the Government for its strong support for racing during the pandemic. Likewise, the Club greatly appreciates the support provided by Hong Kong and Mainland authorities for the cross-boundary transport of horses to and from Conghua Racecourse.

Reflecting on the Club’s achievement over the past year, Club Chairman Philip Chen said, “The Club has shown resilience and resourcefulness in maintaining its operations throughout a fast-changing public health situation. Most of all it has always made the right choice, which is to put the community first.”

Club CEO Winfried Engelbrecht-Bresges said, “I would like to express my sincere thanks to all the Club’s employees for their outstanding contribution during this most challenging year. My special thanks also to trainers, jockeys, stables and transport staff and everyone else in the racing community, many of whom have made a great personal sacrifice. I also really appreciate the support of racing fans in these difficult times.”

Business development

Despite the challenges of the pandemic, the Club continued to invest in its business development. This included its ongoing racecourse redevelopment programme and the opening of two new-look Off-Course Betting Branches.

The digital transformation of the Club’s wagering services also continued. New products included a football app, an eWallet to facilitate cashless betting in Off-Course Betting Branches and secure online account opening. Indeed the Club’s strong financial performance over the past year owes a great deal to the success of its digital products, with over 90% of wagering turnover being generated via online and mobile channels.

Commingling, through which the Club taps the rich potential of global markets, contributed some 17% of overall racing turnover last season, underlining the attractiveness of Hong Kong racing overseas even under pandemic conditions.

Through World Pools the Club is now expanding the concept, with Hong Kong fast emerging as a global hub for commingling on the world’s premier race meetings. Launched just three years ago on Royal Ascot, World Pools doubled in number to 12, with turnover up 88.1% last season.

In this respect, the Government’s decision to increase the number of simulcast days from 23 to 37 per year, and also to permit simulcasting over the summer months, was especially important. Firstly, it addresses a significant loophole exploited by illegal operators to target Hong Kong bettors during the summer break between racing seasons. Secondly it enables Hong Kong fans to watch and wager on more of the world’s best racing, with turnover on overseas simulcast races up 34% last season.

Business results

The success of the Club’s pandemic response, underpinned by its ongoing business development, enabled it to achieve a new turnover record of HK$279.7 billion in 2020/21.

Racing betting turnover for the year was up 12.5% to HK$136.1 billion and for the season up 12.1% to HK$136.4 billion. Racing betting duty returned to the Government for the year was up 13.7% to HK$13.7 billion and for the season up 13.6% to HK$13.8 billion.

Football betting also saw a very positive performance with turnover for the year up 51.4% to HK$140.2 billion and football betting duty up 47.4% to HK$9.25 billion.   This reflected the resumption of major leagues and the rescheduling of postponed matches and competitions, notably Euro 2020 and Copa America 2020, resulting in an exceptionally large number of matches in 2020/21. This unusual situation is unlikely to recur.

The Mark Six was suspended between February and mid-September 2020 for public health reasons and in parallel with the closure of Off-Course Betting Branches. Over-the-counter sales only fully resumed from May 2021. In consequence Mark Six turnover for the year was down 34.3% to HK$3.4 billion, with lottery duty and Lotteries Fund contributions being HK$1.3 billion.

Strong support for the community

The Club’s support for the community was more important than ever given the ongoing impact of COVID-19. In total the Club’s Charities Trust approved HK$4.5 billion in donations in 2020/21, matching the previous year’s record high.

In addition to its regular donations the Charities Trust continued to address needs arising from the pandemic. Having responded to urgent needs in the early months, the focus now is on helping those affected by the pandemic’s prolonged impact and building resilience to cope with the new normal. Initiatives include a meal service for the food insecure, a talent-matching and development programme for first-time job-seekers, upgrading of sanitary and medical facilities for the elderly and people with disabilities, and educational support projects. In total the Charities Trust has approved HK$1.5 billion in relief measures since the beginning of the pandemic, with over one million people benefiting to date.

Meanwhile this year saw work completed on the building structure of the Hong Kong Palace Museum, due to open next year, as well as the opening of the CUHK Medical Centre at Sha Tin. The latter was funded with a HK$1.3 billion donation from the Charities Trust, its largest ever to the medical sector.

The way forward

Although the Club has performed better than expected over the past year, it is mindful of the very challenging environment affecting both its business and the community it serves. In response, and also to position the Club for future growth, the Club carried out three strategic reviews this year. New strategies have been developed for Charities, Racing and the Mainland.

Taking account of current social trends, the new charities strategy will have four focus areas: Positive Ageing & Elderly Care; Children & Youth Development; Healthy Community; and Talent & Capacity Building. There will however be no departure from current commitments. The Club will continue to support a wide range of community needs.

As regards racing, with the Club having achieved its goal of world-class racing the aim is to consolidate and sustain its position. Measures will be implemented to attract, develop and retain top equine, riding and training talent. Stabling and training facilities will be expanded and upgraded. A holistic horse welfare plan will enhance the care provided to horses during and after their racing careers.

In terms of the Mainland, the review considered opportunities within the Greater Bay Area, particularly with respect to developing the equine industry. This was articulated under the Club’s Racing Vision 2030.

Click here to see the complete press release.

The Hong Kong Jockey Club’s 2020/21 Annual Report can be downloaded from the HKJC website here.

SOURCE: Hong Kong Jockey Club.

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