Melbourne Cup crowds can’t soothe VRC’s financial hit; No respite as Paul Skamvougeras exits Perpetual

The Victoria Racing Club’s losses rose to $16.96m from the $14.94m reported by the VRC after the misery of 2021. Picture: Getty Images

This year’s Melbourne Cup certainly brought back the crowds after two years of strait-jacketing under Victoria’s Covid-19 restrictions. And with the crowds came the parade of silly hats, the miasma of vape smoke, the long-held and beloved traditions of disgrace and excess.

And yet still missing, it seems, are the crucial cash inflows that once made the Victoria Racing Club – organiser of the Cup – a profitable and successful entity.

Its accounts, lodged in recent days, reveal a business model that’s still wholly reliant on four days of racing over the calendar year, with losses and liabilities prompting the board to scramble for more funds to address a burgeoning financial hazard.

These losses rose to $16.96m from the $14.94m reported by the VRC after the misery of 2021. Its liabilities currently exceed its asset base by $26m, up from $20.1m last year. Revenue increased to $172.2m – up 23 per cent – but so did expenses, climbing 26 per cent to reach $174.3m.

Unsurprisingly, these unpalatable figures have been blamed on the exigencies of the pandemic and the hobbling of crowd numbers that occurred as a consequence. These alone are said to have cut takings by about $11.6m.

But of deeper concern is the VRC’s move to once again increase its borrowing power with ANZ. An agreement was signed in early October, weeks before Cup Day, for an additional $10m loan facility to be made available. That’s on top of a $53.5m already granted to the VRC, of which $48.5m has been used.

These loans are said to be secured against freehold land owned by the club, according to the documents.

But it’s not all bad news! The VRC has managed to find a bit of dosh to swing at its key management personnel. It also hired a few more executive general managers, because who would want fewer of them?

And they have to be paid, of course. Their collective compensation increased from $2.3m to $3.8m owing to “a strategic restructure of the Club” and salaries being “returned to pre-Covid levels” after the stand-down orders of the last year.

Some minor footnotes, too. EY was engaged to provide brand research for the VRC. Helpfully, VRC Director Glenn Carmody is a partner with the accounting firm. Mates’ rates?

Club chairman Neil Wilson was also given board permission to continue driving his free Lexus and have its operating expenses paid for as a “benefit of the role of chairman”. Prudent use of member funds! The vehicle itself is provided by Lexus, of course. They’re the VRC’s principal partner.

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Plagiarism to politics

Where does a twice-caught plagiarist find work?

When it comes to Tanveer Ahmed, apparently the Financial Review. And if things go well, also at the Liberal Party.

Ahmed, sacked from this masthead two years after being dropped from the Sydney Morning Herald for “inadvertently” pilfering the work of others, is one of the candidates to emerge for the NSW seat of Drummoyne, where former sports minister John Sidoti is considering whether to run as an independent.

Sidoti was dropped from the Liberal Party after the corruption watchdog found that he used his position to try to advance his family’s property interests.

Tanveer Ahmed is backed by former PM Tony Abbott. Picture: Simon Chillingworth

Ahmed, according to material he has distributed to party members, has secured the endorsement of not only former prime minister Tony Abbott – “he has shown the kind of courage that we need much more of in our public life” – but also federal treasury spokesman Angus Taylor.

Taylor writes Ahmed has “a proven ability to articulate conservative values in public forums”.

Even if they are someone else’s views, presumably.

For what it is worth, Margaret CunneenSC is also backing Ahmed.

The material notes Ahmed writes regular columns for the AFR and appears on Sky News.

Not mentioned are his earlier escapades.

For pure chutzpah, however, Ahmed has no hope against James Harb, a lawyer who apparently has “led the legal profession in international organisations such as the United Nations”.

He was, his material notes, also the dux of his high school.

“I am comfortable dealing with all kinds of people, ranging from poor factory workers … to presidents, princes and priests all over the world.”

Just in case Joe Biden were to visit Five Dock.

Nobody in the party, meanwhile, is quite sure whether Sidoti will run again as an independent.

Local real estate agent Christian Bracci appears to be one front runner for no other reason that his candidacy may dissuade Sidoti from giving the March election a solo crack.

The other is former Gladys Berejiklian adviser Berge Okosdinossian, now at lobby shop CT Group.

He’s secured the backing of ex-premier Nick Greiner, although Berejiklian’s new gig at Optus will presumably make it too difficult for her to wade back into state politics … if she could stomach it.

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Noisy neighbours

One suspects that Paul Skamvougeras, the erstwhile head of equities at Perpetual, will find some down time to smoulder a bit following his sudden resignation from the company on Monday.

Paul Skamvougeras. Picture: Hollie Adams

Or maybe not? It looks like Skamma’s already registered a couple of companies this year. One is Bigmaan Pty Limited and the other is Chubman Pty Limited. Both were registered to his home in Vaucluse.

We’re told these odd designations will likely be used by Skamvougeras to manage his own money. There’s no play afoot to set up in the world of boutique funds management. Would you invest with Chubman? It’s hardly a worse name than Fat Prophets.

Of course, if Skamvougeras was hoping for some tranquillity he’s likely to be disappointed. He lives behind stockbroker Angus Aitken, whose Olola Ave home – recently owned by former FAI chief Rodney Adler – is undergoing a bit of a touch up. There’s probably a year to go until drilling and construction is complete. Another neighbour, former ACCC chair Rod Sims, can probably attest to the cacophony.

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Higher and hire

A couple of board appointments of note. Farrel Meltzer, founder of Melbourne-based investment manager Wingate, is joining the board of the Melbourne Symphony Orchestra this week.

It places Meltzer alongside Margaret Jackson; she was ANZ’s chair when Meltzer headed its private bank division many moons ago. The directorship is an honorary appointment, so no salaries for Meltzer or Jackson for that matter; the expectation actually runs the other way – they’re supposed to donate money to the MSO.

Meanwhile, former Labor minister Joel Fitzgibbon is joining the board of Brickworks, according to an announcement released on Monday. He starts at the brick manufacturer in January with a fixed package of $160,839.