Cape Town - The future of horse racing in the country, particularly the Western Cape, hangs in the balance as the full extent of the financial problems facing Phumelela Gaming and Leisure Limited emerged in its delayed annual financial results.
The group incurred a loss for the year of R96 million, whereas last year it made a profit of R154m. Meanwhile, the current liabilities of the group exceed the current assets by R472m (2018: R25m).
The issues facing Phumelala were aired at a meeting held at Kenilworth Racecourse on Monday night. The meeting was addressed by the co-chairmen of Kenilworth Racing, Robert Bloomberg and Mark Currie, among others. Kenilworth Racing is managed by Phumelela.
Speaking afterwards, Bloomberg said: “As you probably are aware there has been a lot of adverse publicity about horse racing, and the sport is in a pretty dark place right now financially.
“Phumelele’s share price has been decimated. From around R26, it is now trading at under R2.”
Attending the meeting were stakeholders in the sport, including owners, trainers, breeders, jockeys and blood stock agents, and many expressed their concerns about the future sustainability of Kenilworth Racing.
During the meeting, which was heated at times, racing historian and expert Charles Faull took Bloomberg to task about corporate sponsorship and the image of racing in South Africa today.
Faull said he had spoken to someone about investing in a sponsorship, but the person turned him down, saying horse racing had a bad image, and businesses did not want to be associated with it.
“The image of the sport is shocking. The general public do not trust us,” said Faull.
When a speaker from the floor suggested horse racing needed to attract younger owners - “for instance a successful 35-year-old male, married with children, who would normally play golf or spend his money on a fishing boat” - Bloomberg replied: “People are concerned about racing folding here. It won’t happen.
“Thirty-five percent of our ownership base is international, and it really is time the other regions recognised our contribution to racing, the quality of the horses, and what we bring to the party, as opposed to looking at what our turnovers are based solely on the demographics of the country.
“The idea of this meeting is that there are three racing operators in South Africa - Phumelela, Gold Circle and Kenilworth Racing.
“It is the first time we believe an operator has been transparent enough to meet with everybody (owners, trainers, breeders, jockeys, blood stock agents etc) to discuss with them where we came from at the time of our de-merger with Gold Circle to where we are now today, and how we are trying to address the financial issues that confront us.”
@MwangiGithahu