02/27/2009 12:00AM

Focus on racing pays off for Moores

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LEXINGTON, Ky. - As the year-long recession has put economic pressure on the country and most of the world, so too has it exerted forces on operations within racing and breeding.

But the general economy was not the foremost reason for the change in direction for the racing and breeding operation of John and Susan Moore.

John Moore said that when they started 10 years ago, they "wanted to race and breed. We had some nice mares, but every year we had problems."

First, Moore said, they had to deal with mare reproductive loss syndrome, then with many of the other difficulties breeders face in the complex and sometimes frustrating process of breeding mares and raising foals.

As a result, Moore said that his wife "decided she was cursed. She had built a $10 million business and she doesn't want to continue with so many disappointments."

Highly success-oriented and focused, Susan Moore said, "I feel so out of control because the broodmares are in Kentucky."

The Moores live on the East Coast, and without the opportunity for Susan to be on the farm with the mares and immerse herself in details of breeding and farming, they have decided to stick with buying young prospects and racing them.

"We are good at finding good yearlings and 2-year-olds and managing their racing careers, then letting someone else take care of them when they are ready for retirement," she said. "Our success indicated which direction to pursue. After we started buying better-quality horses, buying 49 horses for an average price of $112,633, we have 31 percent stakes winners and 39 percent stakes horses from those purchased. We have been very successful racing horses, almost all purchased as yearlings, and have a great relationship with our main trainer, Jimmy Jerkens."

The Moores participate in racing partnerships, typically owning the majority of the horse, and they need to make those arrangements as profitable as possible. And in that regard, the constriction of the economy has prodded them to make changes.

"All of the racemares that we develop we would prefer to sell, and if it's not viable to sell them off the track, we will put them in foal and sell them then," Susan Moore said. "But our plan is to develop racehorses, not to breed horses. There are people who are breeders, have breeding farms, and that is what they excel at. We don't have a breeding farm, and that is not what we excel at."

In light of that change of direction, the Moores sold Acorn Stakes winner Zaftig in a private transaction for a seven-figure sum to John Sikura's Hill 'n Dale Farm in February.

In addition to Grade 1 winner Zaftig, the Moores have sold such racing stars as Smokey Glacken (a half-sister to the champion sprinter and good sire Smoke Glacken) and stakes winner Lady Marlboro (by Smoke Glacken) as they have shed breeding stock to focus on racing horses and have streamlined their operation for cash flow.

An indicator of how profitable this has been for some of their partnerships comes from Mark Taylor of Taylor Made Farm.

"The Moores bought both Smokey Glacken and Zaftig from us for $150,000 apiece and then, after racing them successfully, resold them as broodmare prospects for nearly $3 million total," he said.

The profits and successes that the Moores and their M&M Stable partners have experienced do not come by sheer chance.

"I do the syndications, insurance, accounting, and business part of the horse ownership," said John Moore, an investment banker. "We have done it together for 10 years and have learned a lot about who to trust and what to do."

"Our average ownership across the board in the 10 partnerships and LLCs is 57 percent, ranging from a low of 28 percent to a high of 78 percent," he said. "Our eventual goal is to own 20 percent to 40 percent of perhaps 80 to 100 racehorses, always taking the largest share of any partner."

"We charge a fee for organizing the partnership, managing and acquiring a horse, a fee for selling a horse, and we take a success fee when and if the partners make a profit on their investment."

But among their efforts to control costs, Moore said, "We even buy commonly used medications or drugs" - for example, Gastrogard - "directly and supply it to the vets and trainers in order to avoid their mark-ups, significantly reducing those costs, and we pass that along [to the partners] at our cost."

On the racetrack and equine management side, he said, "Susan's daily micromanagement with trainers and veterinarians, added to patience, makes it all happen."

And commitment of that intensity cannot come from a preoccupation with profitability alone. It is the result of a visceral interest in the horses and the sport.

"Most of the horses we've had wouldn't have panned out for most people," Susan Moore said. "They would have been put in claiming races or given away. For instance, we had a horse named Tiger (by Storm Boot) who bowed a tendon twice before we finally won a stakes with him," the Grade 3 Bold Ruler.

When the horse was laid up with a bowed tendon for the second time, the Moores encouraged their veterinarians to find a way to rehabilitate Tiger.

"They blistered him, used a cell therapy, and turned him out for a year," she said of the therapy. "Then we had him evaluated, put him back into training with Jimmy [Jerkens], broke a track record, won a stakes, and eventually bowed again. But we fixed him up and found him a good home."