03/31/2011 11:49AM

Woodbine intent on achieving growth in ontrack handle

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ETOBICOKE, Ontario – The Woodbine Entertainment Group’s Thoroughbred racing business had been going against the flow in recent years, with purses holding steady and all-sources handle on live Thoroughbred racing on the rise.

So, after it was reported that business had been up by 8.9 percent for last year’s meeting, there was some surprise when it was learned that purses have been reduced by an overall average of some 2 percent for this year’s 167-day session, which begins on Saturday.

“We were really the only jurisdiction in North America to show any growth in our handle,” said Nick Eaves, who is in the midst of his first full term as WEG’s president and chief executive officer after officially taking over the latter role from David Willmot last June.

“Growth is growth, and obviously we’ll take it. But, all of that growth is in the U.S. market and that’s a bit of a double-edged sword.

“On the one hand, it speaks very clearly to the improving quality of our racing program and it’s a function of purse scale, quality of the racing surfaces, and field size.

“But, with those dollars that are coming back, the track and the purses are sharing on average 3 percent from a dollar bet on our Thoroughbred racing in the U.S. whereas in our home market area we’re sharing on average 20 percent.”

WEG will be looking for a boost in “live” wagering on several continuing fronts this year.

“One area where we had real success last year was on our ‘big-event’ days,” said Eaves, noting that both Queen’s Plate Day (with Queen Elizabeth II in attendance) and Canadian International Day produced record handles. Woodbine Mile Day and Woodbine Oaks/Plate Trial Day also showed increases over the previous year.

“Obviously, those days bring in our best wagering from new customers and casual customers,” Eaves said. “We’ll put a lot of firepower behind showcasing those days in this market.”

Woodbine also will be looking for more growth through its in-house production “Bet Night Live,” its revamped offering on The Score television network, which was launched last year with an eye toward attracting a new breed of customer for the company’s HorsePlayer Interactive wagering platform.

“I think it’s been a successful work in progress,” said Eaves. “Our viewership was up materially, in the 40 percent range. We tied the program format to our contests through the HPI system, so we obviously were able to attract handle and we signed up a sizeable number of new accounts. The number of accounts which have remained active has been encouraging.”

Live trifecta pools also should get a boost as Woodbine is cutting its takeout by 2 percent, to 25 percent. The trifecta takeout includes a 4 percent levy which goes to Ontario’s Thoroughbred Improvement Fund and has been a source of contention for Woodbine Entertainment.

“The Horse Improvement Program is a model of success but the fact that it’s funded from parimutuel wagering means the customer’s paying it, and that’s not such a good thing,” said Eaves. “And it’s also disproportionately funded by us because we’re the vast majority of parimutuel wagering in the province.

“Woodbine and our horsemen have agreed that the 2 percent reduction is the right thing to do in returning value back to the customer. Trifecta wagering is a third of the wagering profile on our product.”

Eaves has other reasons to be optimistic on the eve of the Thoroughbred opener.

Pool size for Woodbine’s current Standardbred meeting, which has been cut back to four days a week, has shown gains of more than 15 percent and Thoroughbred simulcasts have increased almost 5 percent despite a slew of weather-related cancellations this winter.

Additional income will begin coming in soon from Woodbine’s new slots area, which eventually will bring the total number of machines here to 3,000.

The original slots area, which opened in 2000, had been home to some 2,000 machines and some 300 have been added during the initial stages of the 16,000-square-foot expansion.

“On April 6, the first microphase of the expansion will open with 180 or so machines and that will include a revamped and modernized Willows Dining Room,” said Eaves.

“Over the next 30 to 45 days the balance will come on line, so by the middle of May that area will be complete with all 700 of those games operational.

“A new VIP high rollers area, with about 106 games, will be the last piece of the renovation to open.”

In the meantime, Eaves reports that slots business has been down only slightly despite some disruptions caused by the construction and some uncooperative weather on prime-time winter weekends.

And while there will be more construction this year, as the Ontario Lottery and Gaming Corporation will be closing off blocks of machines in an 18-month project which involves floor-to-ceiling retrofitting in the original 57,000-square-foot slots area, Eaves said he believes the net result will be positive.

“We’re optimistic that with the opening of the new space, and a marketing plan that the OLG has, that the expansion will be successful,” he said.

The stakes are high, as Eaves said that WEG’s total investment in the project will run to $30 million. Another $4 million was invested on the backstretch, as renovations on four barns brought that project which began in 2004 to a close this winter.

The one major project which remains on the back-burner is “Woodbine Live!”, the onsite venture which was first announced in 2005 as a partnership between WEG and the Cordish Group and is slated to include hotel, entertainment, retail, recreational and housing facilities.

“It’s tough going,” said Eaves “We continue to work hard on it; that hasn’t changed one bit. We’re continuing to move through the city’s approval process, which I’ve been saying for some time.

“We’re balancing maintaining the support of the various levels of government and making sure that the right conditions are there in terms of level of leasing, lease rates, and the sort of financing that we can get in place.”