ECONOMIC IMPACT OF IRISH - BREEDING AND RACING 2017
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ECONOMIC IMPACT OF IRISH breeding and RACING 2017
1.3 million
28,900
Direct, indirect and secondary employment
Attendees at Irish racing
€1.84 billion
Total direct and stimulated
expenditure
€438m
Bloodstock sales
by Irish vendors
Contents
BREEDERS Foreword
BREEDERS 02
0-99 Number of Breeders 0-99 Number of Breeders
100-199 Number of Trainers 13 100-199 Number of Trainers
200-299 Racecourses
18 2 53
Executive
200-299
summary
Racecourses
04
3
DERRY 13
300-399 DONEGAL 300-399
ANTRIM
400+ 41
5
Introduction 08
400+
Source: HRI. TYRONE
6 Overall economic impact 10
1 48 214
5 8 19
FERMANAGH 26
0 ARMAGH
15
1 DOWN Economic Factors 12
MONAGHAN
43 4
SLIGO CAVAN
4 LEITRIM
MAYO
29 49
0
International Standing 18
ROSCOMMON 2
LOUTH
64 LONGFORD
MEATH
1 24
205 455 Breeding 22
2 58
12
WESTMEATH 129
220
GALWAY
20 821
16 Owners 30
DUBLIN
OFFALY 81
128
4
KILDARE WICKLOW Trainers 36
105 LAOIS 159
98 9 9
CLARE
17
CARLOW
Racecourses 38
357 152
TIPPERARY 37 13 604
307
877 KILKENNY 44 Media and Betting 46
LIMERICK 78
24 WEXFORD
266 Domestic Importance 52
36
CORK WATERFORD
KERRY
48
6
883 REPORT PREPARATION, 60
83
METHODOLOGY AND LIMITATIONS
This Report has been prepared for Horse Racing Ireland and has The report has been prepared principally from information that Further details covering the scope and limitations of our report,
been written in general terms and therefore cannot be relied upon you have provided to us, pursuant to the scope of the work agreed its use and our legal responsibilities are set out on page 60.
to cover specific situations; application of the principles set out in the engagement letter, and from other available sources
will depend upon the particular circumstances involved and we consulted during the preparation of this report. © Deloitte. All rights reserved.
recommend that you obtain professional advice before acting or
refraining from action on any of the contents of this publication. Whilst all reasonable care has been taken to ensure that such Graphic Design: www.heliographic.co.uk
information has been accurately extracted or derived from these
No other party is entitled to rely on our report for any purpose sources, we have not separately verified the information, nor Photography: Sam Barnes/Sportsfile, B D Baugh, James
whatsoever and we accept no duty of care or liability to any other sought to establish the reliability of the sources. Crombie/INPHO, David Fitzgerald/Sportsfile, Healy Racing
party who is shown or gains access to this report. Photographers, Amy Lynam, Patrick McCann, Barbara McCarthy,
Insofar as this document contains conclusions and opinions, Eóin Noonan/Sportsfile, Caroline Norris, Morgan Treacy/INPHO,
these are statements of opinion and should not be treated as Edward Whitaker.
statements of fact. These opinions and conclusions are derived
from the work we have undertaken, as described herein, and are
held at the date hereof but may not be applicable thereafter.
ECONOMIC IMPACT OF IRISH breeding and RACING 2017 01
Foreword
Horse Racing Ireland Our advantages are many: our climate, There is little doubt: breeding and racing
our pastures with limestone bedrock, our is in our blood. 25% of the Irish public say
generations of bloodlines and our horsemen that they are interested in racing and when
I am privileged to introduce Deloitte’s and women, together with government Deloitte analysed the breeding and ownership
Economic Impact Study into the Irish support and public interest in what happens numbers for Ireland, and held them up to
Breeding and Racing industry, a document on the racecourse. international comparison, they found that
that captures in great detail the contribution there were over 50 thoroughbred horses per
that this industry makes to the Irish But while our disadvantages are not as strong 10,000 people in Ireland, a number that is
economy. in number, they have come into sharp focus several multiples more than the other major
since 2016 when Britain voted to leave the racing nations and ten times higher than our
When Horse Racing Ireland commissioned European Union. We are a nation surrounded nearest neighbour, Great Britain.
this report in spring 2017, we set Deloitte the by water, on the edge of the EU, with access
task of quantifying the up-to-date economic to our near neighbours and our biggest export The success of Irish-bred and Irish-trained
impact of Irish Breeding and Racing. market filled with uncertainty. Brexit poses horses abroad, and the continued influence of
serious potential risks to the Irish Breeding Irish-born jockeys and stable staff, underline
The key findings unearthed for this report and Racing industry and Horse Racing Ireland’s global standing. Our Breeding and
reflect a vibrant industry that, as well as Ireland will be working very closely with Racing industry certainly delivers to the local
sparking significant economic activity in our stakeholders and European colleagues, economy like few others but, in racing terms,
Ireland, also brings with it much needed including the BHA and France Galop, as well it also sits in the centre of the world.
foreign direct investment. as various State and EU departments.
A big thank you to the Deloitte team for their
The headline figures back up the assertion This work will be important to everybody in expertise and diligence in putting together
that this is a unique industry with a wide rural the industry but especially to those areas that this intriguing document and to those people
reach and a sizeable economic impact. For have not yet returned to the levels experienced who, behind the data and charts, are a daily
example, according to Deloitte’s report, 15,200 pre-2007. This report – a snapshot of where embodiment of what makes thoroughbred
FTEs worked in the core Breeding and Racing we are – shines a light on a number of areas breeding and racing in Ireland so good.
industry and directly related industries, with that need investment, care and attention.
a total direct and stimulated expenditure Joe Keeling
of €1.84 billion, driven by a core gross By far the most important issue that needs to Chairman
expenditure of €1.05 billion. be addressed is to put in place a long-term Horse Racing Ireland
and sustainable funding structure for the
In every county in Ireland the tradition of industry which can allow it to be developed to
breeding thoroughbred horses continues. 92% its full potential, increasing both the economic
of the 6,777 registered breeders have fewer and social dividend for the country.
than five broodmares but the Irish Breeding
industry continues to set global standards. We would ask politicians from all parties to
In 2016 Ireland produced 9,381 live foals, provide the necessary policy support to allow
greater on a per capita basis than any other this to happen.
country in the world and a figure that makes
us the third biggest thoroughbred breeding The investigations in this document inform
nation in the world. the great responsibility felt in Horse Racing
Ireland to those thousands of people across
the country who, directly and indirectly, rely on
a successful Breeding and Racing industry for
their livelihood.
02 ECONOMIC IMPACT OF IRISH breeding and RACING 2017
deloitte sports business group The report highlights that whilst the industry The global nature of racing brings competition
suffered contractions from the deep economic between the top racing nations for owners,
challenges faced by Ireland from 2007, the breeders and horses. It is therefore important
It is increasingly important for an industry to most important industry metrics are now the Irish Breeding and Racing industry
be able to demonstrate its size and economic recovering. continues to invest in its infrastructure –
worth to its stakeholders. This is particularly whether that is continuing the programme
the case for an industry such as Irish Our research identified that Breeding and of capital investment in racecourses (over
Breeding and Racing, which encompasses Racing activities in Ireland are the most €100m scheduled for 2017 to 2019), ensuring
elements of very different sectors, notably prominent and important of any country on prize money remains competitive, the
the rural economy, sport (as part of the a per capita basis. Ireland was the second education and development of its skilled
wider leisure economy) and a diverse betting biggest seller of bloodstock at public auctions workforce or retaining high class bloodstock,
industry. We were therefore delighted to be in 2016 with €338m of horses sold by Irish particularly stallions, in Ireland.
set this task by Horse Racing Ireland, on the vendors, behind only the USA. More than 1
industry’s behalf. in 5 of the top rated Flat horses in training In preparing the report we have spoken to
in 2016 were Irish bred, with many of them people from more than 20 organisations
We are privileged in the Sports Business trained in Ireland and winning major global drawn from every sector of the industry.
Group to work full time in sport, which races. We would like to thank everyone for their
enables us to compare and contrast the size, time, responsiveness, information and the
scale and structure of many sports across The international standing of Irish Breeding openness in which all our consultations were
the globe. Our previous work in racing in other and Racing is further highlighted by the performed.
major racing nations meant we knew the substantial presence of many of the world’s
economic footprint of the Irish Breeding and largest thoroughbred breeders and owners We hope you enjoy reading the report and
Racing industry would be significant – both drawn from a wide range of countries, that it proves a valuable tool for Irish Breeding
in absolute terms and relative to the size of providing significant direct investment to the and Racing.
the overall economy – but nonetheless we island.
were impressed with the scale of contribution Alan Switzer
that emerged. The report also illustrates the geographic Director
spread of the industry, perhaps best shown Deloitte Sports Business Group
Considering the headline economic data first, by the Breeding sector whose 6,500+
the total direct and stimulated expenditure breeders are drawn from every county, with
of the Irish Breeding and Racing industry is racecourses and trainers also spread across
estimated at €1.84 billion, with Gross Value the island, typically supporting jobs in the
Added (comparable to GDP) of €813m. rural economy.
This expenditure supports a workforce of The domestic popularity of the sport is
28,900 FTEs, encompassing the core industry, highlighted by over 1.3m people attending
directly related industries (many equine the 356 fixtures staged at the 26 racecourses
related such as vets and farriers), secondary in 2016, second only to GAA in terms of Irish
employment (as the industry’s expenditure sporting attendances. Furthermore 25% of
flows through the wider economy) and the Republic of Ireland’s adult population
employees of the betting sector (primarily are interested in racing - other major racing
working in the c.1,200 betting shops in Ireland). nations would be delighted to reach such high
levels.
ECONOMIC IMPACT OF IRISH breeding and RACING 2017 03
Executive summary
The economic impact of the Irish Breeding and Racing • Owners are estimated to have incurred
gross expenditure of €176m on training
industry is estimated in this report by reference to and associated costs, with a net input
its core participants – breeders, owners, trainers, of €134m after €42m of domestic prize
money is received.
stable staff, jockeys, racecourses, racing
organisations, media and racing consumers such as • Racecourses, via the total spending by
racegoers, broadcasters, sponsors and
bettors and racegoers. commercial partners contribute €80m.
Additionally HRI receives media and data
The report also assesses Ireland’s position in Key measures of Racing – 2016 rights income of €6m.
comparison to other leading racing nations,
discusses the industry’s contribution to rural • Government funding of €60m comes via
economies and places racing in the context of
€1.84bn Total expenditure
the Horse and Greyhound Racing Fund,
the wider sports and leisure market. Core Breeding and primarily funded from a 1% tax on off-
€1.05bn Racing gross course betting.
expenditure
Economic activity is set out on a 32 county
Direct, indirect and
basis reflecting the structure of the industry 28,900 associated employment
• Off-course expenditure by racegoers is
in Ireland, with references to activities in both estimated to contribute €145m.
the Republic of Ireland and Northern Ireland. Core and directly
The focus is on 2016, but where appropriate 15,200 related industries FTEs
comments on recent movements and EMPLOYMENT
10 year capital
trends, hence encompassing the period since €333m investment
Total employment from the core Irish
2007 with extremely challenging economic Breeding and Racing industry, off-course
conditions which had a negative impact on the Live foals betting and arising from secondary
9,381 (third highest in world)
industry, but from which it is now recovering. expenditure resulted in c.28,900 FTEs.
Public and Private The core Breeding and Racing industry is
€438m bloodstock sales by estimated to employ c.9,500 FTE workers.
Irish vendors
OVERALL ECONOMIC IMPACT
Individuals involved
The total direct and stimulated expenditure 8,187 in ownership
Close to half of the core industry’s employment
of the Irish Breeding and Racing industry is attributable to the Breeding sector,
is estimated as €1.84 billion in 2016, the Total racecourse comprising over 4,000 FTE. Trainers and the
1.3m attendance
core industry comprising €914m of this with staff they employ make up the next largest
secondary expenditure of €927m as the initial sector, stable staff numbering over 2,800 FTE.
expenditure filters through the economy The core Breeding and Racing industry is
through business to business and induced estimated to generate €1.05 billion gross A further c.5,700 jobs are in directly related
consumer expenditure (further detail on p.8). expenditure, which results in economic input employment, many in equine focussed jobs
of €914m into the Irish economy, (after the such as veterinary, farriery, transport, feed
removal of some internal flows), made up of: manufacturers etc.
• The Breeding industry generates gross Ireland’s off-course betting industry, primarily
€1.84 billion expenditure of €583m, primarily from Licensed Betting Offices (“LBOs”) and betting
total expenditure bloodstock sales and stallion nomination operators’ head offices is estimated to employ
fees, with economic input of €489m after c.6,000 FTE, where betting on racing is the
internal flows are removed. largest sport by a considerable margin.
04 ECONOMIC IMPACT OF IRISH breeding and RACING 2017
Secondary employment covers roles that INTERNATIONAL STANDING Following the recession the international foal
are supported by the spending of racing’s Breeding and Racing activities in Ireland are market bottomed out in 2010 and 2011 before
participants in other areas of the Irish the most prominent and important of any showing signs of recovery into 2014. 2015
economy, commonly known as the ‘ripple country on a per capita basis. By illustration and 2016 have seen marked growth, with an
effect’. This is estimated to comprise c.7,700 there are over 50 thoroughbred horses per increase of c.1,400 thoroughbred foals (17%)
jobs. 10,000 of population in Ireland, compared born from 2014 to 2016.
to between three and five for Great Britain,
France and the USA, with Australia the Of the major thoroughbred auctions taking
CAPITAL INVESTMENT nearest at 28 horses. place in Ireland, Great Britain and France,
The Breeding and Racing industry continues Irish vendors comprise €338m (45%) of the
to invest in its facilities and infrastructure. A This prominence is reflected in international total €751m sales in 2016, with €196m (58%)
total of €330m+ is conservatively estimated success in breeding and racing. In addition to of these sales to non-Irish buyers. These
to have been committed in the last 10 years exports generated, more than one in five of the sales therefore represent foreign direct
despite challenging economic conditions. top 100 rated Flat horses in 2016 were Irish investment into the Irish economy.
bred, and c.13% Irish trained.
Racecourses have invested nearly €100m Total bloodstock sales are estimated to rise
of this, underpinned by the HRI capital 21% of top to c.€438m when a conservative estimate of
scheme. A further €105m is scheduled for 100 rated Flat €100m of annual private sales are added to
2017 to 2019, the largest investment being horses are public auctions. Great Britain, followed by
the complete redevelopment of The Curragh Irish bred Hong Kong and the USA being amongst the
Racecourse. current most lucrative markets.
Including real estate purchases, breeders’ Aside from bloodstock sales the other major
expenditure over the last decade is estimated In the 2016 racing season Irish trained horses source of breeders’ income is from nomination
to be in the region of €200m, with c.50% of won €79m in prize money globally, including a fees paid for each live birth resulting from
this from international investors. total of 29 Group 1 races (Flat) and 47 Grade 1 a covering by an Irish stallion. In 2015 there
races (Jump). were over 13,800 coverings by Irish stallions
Core industry Gross Expenditure resulting in nomination fees of c.€130m being
generated (excluding coverings of mares in the
Total €1.05 billion BREEDING same ownership as the stallion). Flat stallions
Ireland is one of the leading bloodstock were responsible for 56% of coverings
producing nations in the world. It is the third resulting in 2016 foals, yet earned over 91% of
176
biggest producer of foals, and Irish vendors the total c.€130m nomination fees.
583 are, by value, estimated to have been the
145
second biggest sellers of bloodstock by public An estimated €45m of nomination fees were
86
auctions in 2016 after the USA. from overseas breeders sending their mares
60
to Irish stallions, hence representing a further
Irish breeders cover a broad range of export for Irish breeding. Many international
operations – from some of the biggest global owners also locate their mares at Irish
bloodstock operations with many of the studs for extended periods pre and/or post
world’s top stallions, to smaller breeders – coverings earning additional boarding fees,
Breeding Racecourses/HRI 92% of the 6,777 registered breeders having conservatively estimated at c.€15m.
Owners Off-course betting/ fewer than five thoroughbred broodmares.
Racegoers off-course government
expenditure
ECONOMIC IMPACT OF IRISH breeding and RACING 2017 05
executive summary
Brexit has had an impact on the value of Total prize money of €57m was paid out in Trainers’ expenditure plays an important role
bloodstock sales in both Ireland and Britain, 2016, less than the amount paid in 2008. Prize in distributing the owners’ financial injection
the fall in the value of the pound negatively money comes from three main sources, the across the rural economy. The labour
impacting Irish vendors selling in Britain, biggest being HRI’s contribution of €36m, intensive nature of training means that the
although helping Irish buyers there. A followed by owners’ entry fees (at 25% the wages of the 2,800 FTE stable staff represent
satisfactory solution is also required to the highest proportion of any major racing nation) the largest expenditure item.
Brexit threat to the current ease of movement and commercial contributions.
of horses between Ireland, Britain and France.
These factors, and the global nature of major The anticipated increase in British prize RACECOURSE FINANCES
breeding operations (e.g. Britain and France money in 2017/18 will erode the competitive Ireland’s 26 racecourses generated revenue of
recently adding to the quality of their stallions) advantage Ireland currently has in terms of €52m in 2016. A significant proportion (60%,
illustrates that while Ireland arguably higher prize money for the majority of races €31m) of this is commercial revenue, the
currently has a leadership position within (which is already somewhat diluted by it being majority being media rights, the importance
Europe, its pre-eminence is not guaranteed. harder to win races in Ireland). It is therefore of which has increased significantly over the
more important than ever that all parties last decade.
in the industry play a role in increasing the
OWNERS number of owners, including trainers and The remaining income is derived from on-
There are a variety of different horse racecourses. course racegoer spend. Racegoers’ estimated
ownership models in Ireland, encompassing spend totalled €45m in 2016, consisting of
sole owners, syndicates, companies and general admissions, catering and on-course
clubs. Across all these forms more than 8,100 TRAINERS betting, equating to an average spend per
people have an interest in ownership. The drop in the number of horses in training racegoer of €35. Of this only €21m, an
since 2008 resulted in a reduction in public average of €16 per attendee, was retained
Registered owners declined by over 40% trainers, down from 449 in 2008 to 372 by the racecourse, with the remainder going
between 2008 and 2015 due primarily to in 2016. It remains a challenging climate to catering partners and on-course betting
economic conditions, but since 2015 have for many trainers to maintain sustainable operators.
returned to growth and the industry has a businesses.
number of initiatives designed to further boost Racecourse costs totalled €41m in 2016
ownership levels. The largest trainers account for a relatively (excluding prize money which is not a direct
high proportion of horses in training, the racecourse cost). Racecourses are therefore
Owners are estimated to have incurred gross largest 32 yards holding over 3,500 horses estimated to have made a cash surplus of
expenditure in excess of €162m in 2016 on the (45% of all horses in training) in 2016. Despite €11m in aggregate in 2016, resulting in a €5m
c.8,600 horses who were in training in Ireland the overall reduction in horses in training, profit after depreciation and finance costs.
at some point (equating to an average cost of the number of horses trained by the largest
€18,800). The payments to trainers, jockeys yards has increased substantially since 2012. A new media rights deal, agreed with SIS in
and supporting industries such as vets, Nonetheless, there will always be the potential 2017, will secure income until 2023 assuming
farriers and transport companies spread the for well supported, connected and skilled new LBO numbers and exchange rates remain
economic benefit widely across the industry. entrants to challenge the status quo. steady. Opportunities for revenue growth
are therefore focused on increasing general
Ireland attracts a wide range of international While the estimated average daily training admissions, catering and other commercial
owners. In 2016 over 2,000 horses were owned rate of €45 is subject to variation, it is at a revenues.
by 500+ non-Irish owners, generating training level which makes it challenging for many
fees and associated expenditure of over €35m. trainers to operate without alternative income
sources.
06 ECONOMIC IMPACT OF IRISH breeding and RACING 2017
ATTENDANCES AND OFF-COURSE sector, and an increase in online and mobile graded races. Over the last five years 25
EXPENDITURE betting, although the rate of decline has Cheltenham Festival winners have been Irish
Racing is the second best attended sport in slowed. The c.330 LBOs in Northern Ireland pointers and such success has underpinned
Ireland after GAA, with over 1.3m attendees have been more stable over this period, in part marked growth in specialist bloodstock sales,
in 2016. A further estimated 100,000 reflecting the largely favourable regulatory from €4m in 2010/11 to €15m in 2016/17.
people attended point-to-point meetings. and taxation environment.
Attendances have grown since 2012, following
several years of decline. While on-course betting in Ireland remains RURAL STANDING
a central part of the raceday experience, The relatively high rural proportion of the Irish
The major festivals are key drivers of turnover levels have markedly declined over population means Agriculture is an important
attendance and direct economic impact, the the last 10 years, and are likely to continue to employer, with Breeding and Racing a key
seven largest festivals forming 39% of total do so as further migration online occurs. part of that. Whilst the industry is spread
attendances in 2016. across the island, there are a number of
Irish Racing generates substantial revenue areas where it is particularly prominent, often
The larger festivals tend to attract a from the media rights sold to the c.10,000 providing significant direct and associated
particularly diverse range of attendees, British and Irish LBOs and for live streaming employment in rural areas with otherwise
including overseas visitors. One or two day of races (25m streams in 2016, an average high unemployment rates.
feature meetings or festivals are also very of c.10,000 per race, and continuing to
important to a number of smaller rurally grow). It is also sold by GBI Racing to over 40 The estimated €370m+ exports of the
based racecourses and the local communities territories worldwide. Breeding and Racing industry are higher than
of which they form a valued part. many other forms of agriculture.
Off-course expenditure also provides MEDIA
substantial economic impact, estimated Irish racing benefits from regular coverage NORTHERN IRELAND
as €137m in 2016, the main components on terrestrial broadcaster RTE. Total racing The Breeding and Racing industry in Northern
being accommodation, food and beverage, viewing figures averaged c.4m over the past Ireland is estimated to generate £32m of
and transport – particularly from festivals. five years, with the most watched day’s racing direct and indirect expenditure, driven by its
Overseas visitors contribute a sizeable each year being the Irish Grand National. two racecourses and network of trainers and
proportion. breeders. The industry currently receives a very
limited contribution from the betting sector,
POINT-TO-POINT which risks hindering its growth prospects.
BETTING Point-to-point racing is an established
Betting on racing is a core part of the pathway to racing under Rules (professional
popularity of the sport in Ireland and racing) for horses, riders and trainers. The RACING’S POSITION IN THE SPORTS
internationally, Irish racing being attractive 100 meetings at the c.70 point-to-point AND LEISURE MARKET
to punters given its quality and competitive locations also contribute significantly to many 25% of the Irish
nature. Per capita betting turnover on racing rural communities as one of the biggest Republic’s adult
in Ireland is amongst the highest in the world events in the local calendar. Attendances can population are
and plays a key role in supporting a large Irish reach several thousand at popular fixtures, interested in racing,
betting industry primarily consisting of a large with the average estimated at c.1,000. comprising nearly
retail estate. 900,000 individuals.
The success of graduates of the Irish point-
The Republic of Ireland LBOs have declined to-point scene is illustrated by 1,127 ex-Irish
from c.1,400 in 2008 to c.850 in 2016, due to point-to-pointers winning under Rules in
economic conditions, consolidation in the 2015/16, with 66 of these wins coming in
ECONOMIC IMPACT OF IRISH breeding and RACING 2017 07
Introduction
Horse Racing Ireland (“HRI”), the national authority for Methodology
A detailed methodology, assumptions and
thoroughbred racing in Ireland with responsibility parameters are included on p.60, the key
for the governance, administration, development and elements being:
promotion of the industry, commissioned Deloitte to • The study measures economic activity
produce a report assessing the contribution of the stimulated directly by the expenditure
of Breeding and Racing’s participants
Irish thoroughbred Breeding and Racing industry (breeders, owners, trainers, jockeys etc.)
(“Breeding and Racing”) to the Irish economy. and consumers (racegoers, viewers,
punters etc.) which then flows through the
wider economy.
The report combines traditional measures of
economic activity such as total expenditure, • Data used to compile this report has been
employment and capital investment together gathered via:
with elements more specific to the Breeding
and Racing industry such as racecourse - Consultations with over 20 Irish
attendances, horses in training, number of Breeding and Racing stakeholders
owners, prize money and value of bloodstock listed on p.60;
sales in order to provide as complete a picture
as possible of its economic worth. - Data supplied by Breeding and Racing
stakeholders;
Breeding and Racing is organised on an all-
Ireland basis, with HRI governing activity in - A survey of racecourses, carried out
the both the Republic of Ireland and Northern in conjunction with the Association of
Ireland. The report primarily describes Irish Racecourses (“AIR”);
economic activity on a 32 county basis, but
where appropriate separate estimates for the - A survey of breeders, carried out in
two countries are set out. conjunction with the Association of
Irish Thoroughbred Breeders (“AITB”);
The report focuses on the period up to and and
including 2016, with comments on current or
future developments as appropriate. Where - Additional primary research carried
relevant, analysis of the period up to ten out by Deloitte.
years ago has been carried out, covering the
significant economic declines experienced
from 2007 but also the gradual recovery that
has occurred in more recent years.
08 ECONOMIC IMPACT OF IRISH breeding and RACING 2017The components of economic impact that this Report structure
report covers include: The report is broken down into seven sections
as described below:
Indirect and
Induced Impacts Economic factors – describes the
employment and capital investment
generated by the Irish Breeding and
Other Direct Impacts
Racing industry;
Core Industry International standing – illustrates
Ireland’s global standing, primarily by
considering its position in the global
Raceday
bloodstock industry and the success of
Irish trained and bred horses;
Multipliers
Breeding – an overview of the Irish
thoroughbred Breeding industry including
production, income and expenditure (i.e.
• Core industry – expenditure generated nomination fees and bloodstock sales),
by Racing’s participants and consumers, and overseas investment;
including other administrative and media
organisations which work exclusively in Owners – reviews the variety of different Media and Betting – considers racing’s
the Breeding and Racing industry; ownership models, number of owners close ties with the media and betting
and horses in training before analysing industries; and
• Other Direct impacts – primarily off- owners’ expenditure, the role of prize
course expenditure of racegoers e.g. money and significance of major owners; Domestic importance – examines
on food, accommodation, transport. the spread and impact of Breeding and
For economic modelling purposes this Trainers – assesses changes in the Racing across the island, considering
expenditure is included in the core number of trainers - including by number point-to-point racing, ancillary industries
industry; and of horses trained - before an overview and their importance in rural areas, an
of trainers’ revenue, expenditure and overview of the education and research
• Indirect and induced – Indirect = business business models; role the industry plays, an assessment
to business expenditure of suppliers of the industry in Northern Ireland and
related to the racing and breeding Racecourses – considers the role its position in the sports and social
industry; Induced = additional expenditure of racecourses as the stage for racing, landscape.
from consumer spending e.g. individuals including analysis of revenue and
working in the Breeding and Racing expenditure and attendances;
industry spending their wages. Specific feature articles have been included
in some sections, describing in more detail
particular aspects of Breeding and Racing.
ECONOMIC IMPACT OF IRISH breeding and RACING 2017 09Overall economic impact
This report estimates the economic impact of the Irish stallion nomination fees from overseas
breeders and Irish breeders not intending
Breeding and Racing industry based on the direct to sell the progeny. Other income from
expenditure of its participants and the associated overseas owners/breeders such as keep
costs for mares is also included here;
expenditure of its consumers which then flows
through the wider economy. • Owners are estimated to have incurred
gross expenditure of €176m, but
received €42m back in domestic prize
Given the many complex two-way flows of Core industry money, resulting in a net contribution to
funds between participants in the Breeding The core industry is estimated to generate the economy of €134m. This does not
and Racing industry, with one participant’s €914m of expenditure into the Irish economy include expenditure on bloodstock which
costs often being another’s income, this made up of the following components: is included in the Breeding industry as
report has attempted to remove any double described above;
counting in order to derive the net injection • The Breeding industry contributes
of expenditure into the Irish economy. The €489m through public and private sales • Racecourses, via the spending by
definition of expenditure will therefore vary of bloodstock from Irish vendors both to racegoers (including on-course betting
from stakeholder to stakeholder within the overseas owners/breeders but also to and all catering spend), sponsors and
industry, but ultimately aims to refer to and domestic owners/breeders not using the commercial partners contribute €80m
reflect ‘new incremental’ cash entering the bloodstock as a means of production. to the core industry. Additionally HRI
Irish economy. In addition the Breeding industry receives receives direct media and data rights
income of €6m;
Figure 1: Overall economic impact – total impact • Government, via betting tax accrued from
off-course betting and the subsequent
Racegoers off-course
expenditure annual Horserace and Greyhound Fund
payment to HRI, represents a €60m core
Breeding industry contribution;
€145m
Gross €583m Secondary
Net €489m expenditure
• Off-course expenditure by racegoers,
B2B
principally on food and drink,
€611m
Core Irish accommodation and transport before
Total direct and
Breeding and Racing and after they enter the racecourse, is
Owners stimulated
Economic impact expenditure estimated to contribute to core industry
Gross €176m
Gross €1.05bn expenditure of €145m.
Net €134m
Net €914m
€1.84bn
Whilst trainers, jockeys and stable staff are
€86m Secondary not specifically detailed in the description
consumer
Racecourses above their expenditure is effectively included
€316m within that of owners. This is merely a
€60m function of the expenditure methodology
Gross value used as not only do they play a vital role in the
Government/ Gross value added
added industry but will also provide economic input
off-course betting
€378m €803m in their own right.
10 ECONOMIC IMPACT OF IRISH breeding and RACING 2017Secondary expenditure The assumed expenditure of the main group of stakeholders has been estimated as follows:
This core Breeding and Racing industry input
of €914m is then augmented by secondary Stakeholder Assumed expenditure
expenditure of €927m as the initial expenditure
filters through the economy, via: Breeders There are over 6,500 breeders in Ireland with over 60 farms standing stallions. Revenue
will be generated from the sale of bloodstock (public or private sales) and by stallion
nomination fees. The economic impact of the breeding sector has been primarily
• Secondary business-to-business (B2B) estimated based on nomination fee income and an analysis of global bloodstock sales by
expenditure of €611m as businesses Irish vendors – both public and private.
supplying the core Breeding and Racing
Owners There are two forms of expenditure for owners:
industry source their own goods and 1. Initial purchase of bloodstock either by public or private sale – this is accounted for as
services from other providers; breeders’ income in the section above;
2. Yearly expenditure on keeping and training horses i.e. training fees, keep costs, jockey
fees and other racing expenditure.
• Secondary consumer expenditure of The annual expenditure is estimated for the c.3,700 owners with horses in training
€316m as people working in the core (or being kept) in Ireland. The expenditure of the owners of c.2,800 point-to-point horses is
also included.
industry spend their wages on other goods
and services within the Irish economy; Racecourses The expenditure generated by Ireland’s 26 licensed racecourses (and c.70 point-to-point
locations) is assumed to include:
• Racegoers – on-course spending such as admission, racecards, catering, corporate
• This €927m secondary expenditure
hospitality
implies that for every €1 spent in the core • Sponsors and advertisers
industry, another €1 is generated due to • On-course betting – Tote commission and bookmaker fees
• Non-raceday attendees – use of racecourse facilities for conferences and events etc.
linkages in the economy.
• See also media below being a major revenue source for racecourses.
Racegoers The off-course expenditure of Ireland’s 1.3m racegoers before arriving at the racecourse
(off-course and after leaving will include transport, accommodation, food and drink, attire and other
Total expenditure and GVA
expenditure) local spending. Whilst providers of these services (e.g. transport companies, local bars
The total direct and stimulated expenditure and restaurants) are not part of the core Breeding and Racing industry the expenditure
of the Irish Breeding and Racing industry is is still generated by the decision to go racing. Purchases of racing publications are also
included here.
therefore estimated as €1.84 billion in 2016, the
core industry comprising €914m of this with Media Viewer and broadcaster expenditure on Irish racing via:
secondary expenditure the remaining €927m. • payments from Satellite Information Services (“SIS”) for distribution of live pictures
and data to LBOs in Ireland, the UK and internationally, including rights to stream Irish
racing to online operators and direct to home (via At The Races)
An alternative measure of the industry’s • payments from terrestrial channels (RTE)
contribution that can be compared to national • Irish racing’s print media revenues (e.g. Racing Post, Irish Field), are included in off-
course expenditure.
indicators such as Gross Domestic Product
(GDP) is provided by Gross Value Added (GVA). Betting The Irish Government supports the Irish Breeding and Racing industry through the Horse
This is obtained by adjusting expenditure to and Greyhound Fund. A 1% betting tax on all bets placed by Irish punters feeds into the
Fund, which in 2016 paid €60m to HRI and is included in core industry expenditure.
isolate the value added in terms of operating
profit and wages paid, based on data from The betting industry also pays racecourses for various media rights to show pictures of
the Central Statistics Office (ROI) and the UK racing via different media channels. Betting operators outside of Ireland (notably from
Great Britain), also contribute via media rights (as described above).
Office for National Statistics (NI).
This means that only the real or gross value
added by stakeholders is included in the
analysis, and on this basis GVA associated
with the €914m core industry expenditure is
estimated to total €378m and overall GVA is
€803m.
ECONOMIC IMPACT OF IRISH breeding and RACING 2017 11Economic factors
Employment
The Breeding and Racing industry is a significant estimated to employ c.6,000 FTE, as whilst the
staff in LBOs also take bets on sports other
direct provider and supporter of employment across than racing it remains the primary product.
Ireland in a range of economic sectors. The production
The number of LBOs in the Republic of
of over 9,000 foals a year, training of 8,600 horses Ireland has reduced significantly in recent
and staging of over 350 fixtures at 26 racecourses is years, from c.1,400 in 2008 to c.850 in
2016, a decline of 39%, resulting in lower
facilitated by employees of the core industry. These employment. The number of LBOs in
in turn are supported by a large number of indirect Northern Ireland is c.330, and has remained
relatively steady over the period, meaning
and associated employees in ancillary and related employment has also been stable.
industries. Many betting sector jobs are also focused
Secondary employment covers roles that
on betting on horseracing. are supported by the spending of racing’s
participants in other areas of the Irish economy,
Total employment from the core Irish commonly known as the ‘ripple effect’. This is
Breeding and Racing industry, directly related estimated to comprise c.7,700 jobs in 2016.
employment, off-course betting and that
arising from secondary expenditure resulted
in c.28,900 Full Time Equivalent (“FTE”). Core Breeding and Racing industry
The core Breeding and Racing industry was
The core Breeding and Racing industry was estimated to support c.9,500 FTE employees
estimated to employ c.9,500 FTEs workers in in 2016, broken down into c.5,500 full-time and
2016. However, because of the considerable c.9,500 FTEs from part-time and raceday positions.
number of part-time roles that the industry
employs due to the seasonal nature of the Breeding
c.28,900 jobs in Irish
Breeding industry and event-focussed nature
of racing, the total number of individuals
Breeding sector employment comprises
c.1,800 full-time and c.4,700 part-time roles.
Breeding and Racing industry direct, indirect involved is c.15,000. The high proportion of part-time roles is
and secondary employment due to the seasonal nature of the work – i.e.
The c.5,700 directly related employment covering and foaling seasons – and also
covers those activities which, whilst many are due to the fact that a significant proportion
heavily reliant on the Breeding and Racing of breeders are ‘Owner/breeders’ who will
industry, will also serve other economic often carry out the role in addition to larger
sectors. This will include equine-focused farming activities and/or with a small number
roles such as farriers and vets, alongside of temporary staff. This topic is discussed in
those serving the industry more widely in more detail in the Breeding section.
other sectors such as leisure and hospitality.
Around 90 individuals are employed in
The Irish Racing and Betting industries bloodstock administration, including
have long worked alongside each other for employees of the main auction houses
mutual benefit. Ireland’s off-course betting in Ireland – Goffs and Tattersalls Ireland,
industry, primarily Licensed Betting Offices bloodstock agents, and Weatherbys Ireland
(“LBOs”) and betting operators’ head offices is which controls the General Stud Book.
12 ECONOMIC IMPACT OF IRISH breeding and RACING 2017Trainers, stable staff and jockeys Figure 2: Irish Breeding and Racing industry direct, indirect and secondary employment
Ireland’s trainers and the staff they employ (FTE) – 2016
make up the next largest sector, comprising
around a third of the core industry. Ireland’s full
Bloodstock
2
Total: c.28,900
administration Media
time trainers (Public Trainers and Restricted Governance and Administration 88 101 Betting
Licence Holders) totalled 620 individuals in (inc. Education)
340
c.6,000
2016, which rises to c.880 FTE when point- On-course betting
1
to-point handlers, a significant proportion of Racecourses
175
whom will also be full-time, are included.
333 Caterers
Jockeys, agents 370
and valets
Stable staff employed by these trainers and
225 Trainers 3
point-to-point handlers numbered over 2,800
individuals in 2016, comprising c.1,900 full
883
time and c.1,800 part time staff. The high Secondary Stable staff
Directly related
proportion of 1,800 part time staff is primarily c.7,700 2,816 c.5,700
due to the working patterns of yards and the
fact that a number of yards, particularly point-
to-point, will be relatively small operations.
Breeders
Jockeys, plus their valets and agents, totalled c.4,100
c.220 in 2016. The vast majority will be
attached to a yard where they will ride out
every day alongside the stable staff.
The marked decline in horses in training from
2008 (reduction of c.29% to 2016), has seen
a drop in employment of around 600 (c.15%)
across trainers, stable staff and jockeys in the
same period. CORE INDUSTRY
Racecourses
c.9,500
Ireland’s 26 racecourses employ c.330 FTE,
but the actual number of individuals involved most racecourses outsource this function Notes:
is estimated to total c.1,500 due to the to external catering companies, it will still 1. Includes Tote and on-course
event-focussed nature of their activities. Full- be an important provider of local jobs. It is bookmakers.
time roles will typically include racecourse estimated to employ c.370 FTE, with several 2. Includes Weatherbys Ireland and
management, non-raceday event staff and thousand individuals working at a racecourse bloodstock auctioneers and agents.
ground staff that tend to the racing surface at some point in the year. 3. Includes Public Trainers, Restricted
all year round. At the larger festivals up to Licence Holders and point-to-point
800 individuals can be employed on a raceday On-course betting activity supports c.175 FTE, Handlers.
when caterers are also included. comprising independent ‘rails’ bookmakers
alongside employees of the Tote. Employment Source: HRI; Deloitte analysis.
Catering employees are central to is under pressure in this area given a decline
racecourses’ food and beverage offerings, in on-course betting.
including corporate hospitality, and although
ECONOMIC IMPACT OF IRISH breeding and RACING 2017 13Economic factors
Governance and administration Media
The governance and administration of Media staff directly involved in racing are
Breeding and Racing is estimated to employ estimated to number c.100 FTE. These
340 FTE. This includes all employees of include the written and online press for
HRI and its subsidiaries such as Irish publications such as the Racing Post and Irish
Thoroughbred Marketing alongside the Field together with racing correspondents of
Turf Club and associations responsible the national newspapers and local journalists
for different sectors of the Breeding and who cover the major festivals in their specific
Racing industry. Educational and Research locality. It also includes those individuals who
establishments such as the Racing Academy are involved in the broadcast of racing, both
and Centre of Education (RACE) and Irish transmission of pictures to betting shops and
Equine Centre are also included. also terrestrial broadcasters for those fixtures
shown on RTE.
14 ECONOMIC IMPACT OF IRISH breeding and RACING 2017Capital investment
In order to maintain and build on its position as one a further €47m allocated for the next three
years to 2019, has enabled the majority of
of the world’s leading breeding and racing nations racecourses to carry out improvements to
the industry continues to invest in its facilities their facilities.
and infrastructure. over €330m is conservatively Since 2012 these schemes have typically
estimated to have been committed in the last 10 years, funded around 40% of a project, hence when
racecourse contributions are included it is
despite challenging economic conditions. estimated that total investment of over €90m
has occurred in the last 10 years, and a
Whether through racecourse redevelopments Racecourse improvements further €105m is scheduled for 2017 to 2019.
or maintenance and improvement of facilities Racecourses operate in a highly competitive
at training yards and breeding operations, leisure market, hence must continually improve The largest investment is the complete
ongoing investment is required to offer the standard of facilities for customers, as redevelopment of The Curragh racecourse.
racing’s customers and participants the well as for participants and horses. The Funding has been sourced from a combination
highest quality infrastructure and ensure the required facilities will vary significantly of the HRI Capital Development Scheme and
highest standards of equine welfare. according to the type of racecourse, and private investment. The objective from the
should always be tailored to local demand. outset has been to finance the redevelopment
Due to the predominantly rural location of without any debt, with the project being
racecourses, breeding operations and training HRI provides substantial financial assistance overseen by a new company whose
facilities capital projects provide significant to racecourses through capital schemes. shareholders include HRI, The Turf Club and a
business and resulting employment for Total funding of €44m in the last decade, plus number of private investors.
construction and development firms across
the country, supporting a construction Figure 3: Racecourse capital investment – HRI capital schemes and racecourse
industry which has suffered a marked contributions 2007-2019 (€m)
contraction. A National Roads Authority report
60 57
estimated that for each €100m invested
28
in capital projects, over 1,200 jobs will be
supported, many of these in rural areas. 50
39
40
22
32
14
30 29
20 16
17 13 18
5
7 9 10
7 1 11
10 6 4 9
4 3 3
6 4
2 1 5 1 4
2 2 2
0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Racecourse contribution HRI grant Source: HRI; Racecourse consultations;
Deloitte analysis.
Note: 2017-2019 represents projected spend.
ECONOMIC IMPACT OF IRISH breeding and RACING 2017 15Economic factors
When complete the redeveloped Curragh Breeding
racecourse will house world class facilities Due to the large number (over 6,500
including a major new grandstand, a new registered breeders) and variety in the scale
arrivals and reception area, a new parade of operations - from major global operations
ring, a new weighing room and a refurbished through to the much larger number of owner-
stable yard. breeders with one or two mares pursuing it
as a hobby – estimating the level of capital
It is estimated that the Curragh project will expenditure by the sector is difficult.
result in direct and indirect employment of
c.800 people in the construction industry, However, it is evident that despite the testing
most of these being from the local area. economic conditions experienced throughout
the industry from 2007, investment has
In addition to the largest racecourse continued, often funded by major international
developments listed in the table, the large investors.
majority of other racecourses have, and
continue to, invest significantly in their Major breeding operations make significant
facilities, including Naas with €3m, Tramore, capital investments in order to ensure
Listowel, Roscommon and Sligo who have facilities are of the highest standards and
already or plan to invest more than €1m each. have also spent €millions on the purchase of
additional farms and land.
16 ECONOMIC IMPACT OF IRISH breeding and RACING 2017Racecourse Year of Total Description Other investment
completion investment Capital investment will also have been
€m incurred by other stakeholders in the
core racing industry, including Media and
The Curragh 2019 72 Complete redevelopment Governance and Administration (including
Dundalk 2007 35 Construction of new racecourse including Education), for example on IT infrastructure.
greyhound stadium These sums are estimated as €15m over the
Galway 2007 22 New grandstand and other works past decade.
Leopardstown 2016 20 Major enclosure redevelopment
Punchestown 2018 6 New reserved stand enclosure including
owners and trainers facilities Figure 4: Breeding and Racing industry
Galway 2018 6 Facilities redevelopment capital expenditure 2007-2016 (€m)
Source: HRI; Racecourse consultations; Deloitte research.
15
26
92
It is conservatively estimated that when these The Curragh Training Grounds, the largest
real estate purchases are included, breeders’ public training facility in Ireland (and amongst
expenditure over the last decade will be in the the largest and most respected globally) used
region of €200m. This investment excludes
the much larger expenditure on bloodstock,
by c.1,000 horses per day, have continued
to invest in facilities – c.€5m over the last
Total: €333m
which is discussed in the Breeding section. decade. The facilities at the Curragh Training
Grounds are owned and managed by the new
Curragh Racecourse Company and include: 200
Trainers
The difficult economic climate experienced • 70 miles of grass gallops
since 2007, with subsequent decreases in the
number of horses in training, will have limited • 12 miles of peat gallops Racecourses Trainers
the expenditure available for trainers to carry Breeders Other1
out extensive capital projects. However, prior • 8 All-Weather tracks
to 2007 considerable amounts had been spent Note:
on training facilities, meaning that a high • 2 furlong schooling strip 1 ‘Other’ comprises expenditure incurred by other
quality infrastructure was already in place, racing shareholders involved in Governance,
and improvements have been made by a • Grass NH schooling facilities Administration and Education such as HRI, RACE and
number of major yards in the last decade. Irish Equine Centre.
When all public trainers, restricted licence Source: HRI; Deloitte estimates.
holders, point-to-point handlers and
public training grounds are included it is
conservatively estimated that c.€26m of
capital expenditure has occurred in the last
decade on training facilities.
ECONOMIC IMPACT OF IRISH breeding and RACING 2017 17International standing
International Standing
The Irish breeding and racing industry is extremely The population of Ireland is significantly
smaller than most other leading racing
competitive at a global level, despite other major countries and it is therefore useful to compare
racing nations having much larger populations and some metrics on a per capita basis.
economies. This section illustrates Ireland’s global Figure 5, illustrates just how prominent
standing by first considering its breeding success, the thoroughbred is within Ireland, with
approximately 50 horses per 10,000 people.
being the second largest producer of bloodstock Australia is the next nearest, at 28 horses.
by value, and then the consistent international Thoroughbred Breeding and Racing activities
are therefore the most prominent and
racecourse success of horses trained in and/or bred important of any country.
in Ireland.
Horseracing is a global sport with racing taking Figure 5: Ratio of thoroughbreds to
place in over 60 territories, but is dominated by population
€338m Second largest
producer of
a small number of countries, primarily Ireland,
Great Britain, USA, Australia, France, Japan,
Bloodstock sales
bloodstock by value the UAE and Hong Kong. In 2015, these eight 50 10,000
countries staged over 60% of Flat races and
Ireland
accounted for 75% of total Flat prize money.
Jump racing is much more concentrated,
Third largest 9,381 dominated by Ireland and Great Britain, 28 10,000
producer of foals Foals produced with a significant presence also in France. Australia
In 2015, these three countries constituted
approximately 89% of Jump races and 83% of
total Jump prize money. 5 10,000
Great Britain
The primary competitors to, and indeed
markets for, Irish Breeding and Racing
are therefore Great Britain, France, USA,
4 10,000
Australia, and, to a lesser extent, Japan.
France
While Hong Kong and the UAE are significant
players, these markets have unique features
that make them less directly comparable 3 10,000
to Ireland. The Japanese and Hong Kong USA
markets in particular are domestically
focused with international participation Note: Thoroughbreds comprise horses in training,
typically on an invitation-only basis and mares and foals in order to enable comparisons, but will
limited to a very small number of big races significantly understate total horses in each county.
(although Hong Kong owners are a regular
buyers of Irish bloodstock). Source: Weatherbys; IFHA; BHA; RA; HRI; Worldbank.
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