Covid spring carnival has sprung but fans can only watch on from home

Melbourne’s three racing clubs will do it tough in spring as the coronavirus lockdown bites.

Celebrating the Caulfield Cup ‘experience' in your own living room, with the races being forced to go ahead without crowds. Picture: Alex Coppel. Picture: Alex Coppel.

The way Saturday’s Group I Memsie Stakes is being promoted perfectly encapsulates how this year’s Spring Racing Carnival will be the most challenging and most different ever.

With Victoria locked down thanks to COVID-19, there will be no spectators at Caulfield and Melbourne Racing Club members have instead been offered home-delivered “super boxes” including gourmet sandwiches and tasting items washed down with Moet & Chandon in an attempt to replicate the race day experience.

The food and drink is being prepared by MRC’s pub and catering staff who have been kept on with money from the federal government’s JobKeeper program.

But with racing featured on two Seven Network free-to-air channels, more eyeballs than ever could tune in to the meet, and digital wagering numbers have been through the roof as punters bet only from home.

Yet the Memsie is one of 12 upcoming races — albeit out of 114 — that has had its prizemoney cut, from $1m last year down to $750,000. It sets the scene for a spring carnival like no other.

The MRC’s Caulfield Cup in October will have the tagline “Let’s Bring it Home”, and the following week’s 100th running of the Cox Plate likely will be a made-for-television spectacular. The Melbourne Cup? A virtual-only birdcage glamour precinct looms as the Victoria Racing Club faces the prospect of missing out on almost 300,000 spectators over its four biggest days.

“It won’t be the same primarily because of the difference of having no crowds,” says Racing Victoria chief executive Giles Thompson. “But the program is set, the horses are set and we will have huge reach through our coverage off course.

“So there’s still going to be huge interest and engagement. The stories are still going to be as strong as they have been, as the stories are usually on the course, not in the crowds.

“But people will miss out going, and often their first racing experience is in the spring. The clubs will take a huge financial hit, this is usually their moment in the sun.”

Kayo is your ticket to the best sport streaming Live & On-Demand. New to Kayo? Get your 14-day free trial & start streaming instantly >

Each of the three racing clubs — the MRC, VRC and Moonee Valley Racing Club — have a range of scenarios in place to deal with the hit they will take, but already there have been cost-cutting rounds and job cuts to cope with the unprecedented times.

Some spectators could be allowed later in the spring, government willing, but at heavily reduced numbers.

MRC CEO Josh Blanksby oversees a diversified business with $500m in net assets that effectively props up the racing operations. There are a dozen pubs and clubs, and money has flowed from adjacent property projects, but the MRC has received $1m per month in JobKeeper payments to keep staff employed.

“Our 2020 results, we will have a pretty strong (earnings) number as the pandemic only hit the last three months. But 2021 gets a little ugly from a (profit and loss) point of view. We’re still uncertain when the pubs can open again, that is important. We’re forecasting them to be closed to the end of the calendar year, so we’re being very conservative.”

Skyman ridden by Damien Thornton wins the Neds Handicap at Caulfield last month. Picture: Getty Images

Income from the MRC’s venues accounted for about $94m of the group’s $236m revenue last year, and Blanksby says he has delayed settlement for now at least on the purchase of pubs from two AFL clubs. Yet he wants the MRC to keep going with a big planned revamp and plans to buy more venues in the future.

Meanwhile, Moonee Valley is undertaking a huge $2bn property project on its course that will see more than 2000 apartments built, a new grandstand and other facilities. It needs the money from the project paid in stages, but is suddenly faced with a slowing housing market.

At Flemington, VRC CEO Neil Wilson is adopting a wait-and-see approach regarding crowds and says “I’m more excited than ever about the digital engagement we’ve got planned this year to keep our members and fans engaged. But you don’t need to be a CPA (accountant) to know the financial results are not going to be good.”

Yet in a bright spot for Victorian racing, wagering numbers have also been strong, though Wilson says that income source only accounts for about 10 per cent of the VRC’s annual revenue.

Flutter Entertainment, the global owner of the Sportsbet brand in Australia, revealed this week that it had doubled its operating profit here to almost $200m for the six months to June.

Sportsbet CEO Barni Evans says the industry has done an “incredible job” to keep racing going during COVID-19, showcasing it when other sports were shut down. And as retail betting outlets closed, more punters moved online.

“The upshot of the past few months is that a whole section of racing’s audience has shifted from anonymous, cash-based interaction to highly engaged and digital channels.

“This provides a great platform for the racing industry to overcome some of the uncertainty — particularly the prospect of low or no attendance — as we head into spring carnival.”

Victorian racing is also reliant on its joint venture arrangement with Tabcorp, which has the exclusive retail wagering licence for its TABs until 2025 but has suffered with its outlets and pubs shut during the pandemic.

“That’s been a huge hit,” says Racing Victoria’s Thompson. “Our (betting) turnover is up overall, but our income isn’t up to those levels. We are strong overall but the income is pretty flat year on year.”

Those levels at least mean prizemoney has been maintained and the sector has kept going. But the real fallout could come next year.

Thompson says Racing Victoria is talking to clubs about what further financial assistance they may need to get through once the spring carnival ends.

“This isn’t over. What the cost is for the whole period to the industry and whether we have to dip into our reserves is a fluid situation. To a degree it will depend on what happens in spring. We’re very cautious about the outlook, and concerned about the outlook for the clubs.”