Pakenham Racing Club Annual Report 2014

Pakenham Racing Club Inc.

Aerial view of the new Pakenham Racecourse October 2014

ANNUAL REPORT2014

Annual Report 2014

Pakenham Racing Club Annual Report 20142

Training commenced on 28 July 2014.

Pakenham Trainer, Cameron Templeton & Owner, Peter Kylie hold aloft the 2014 Sportingbet Pakenham Cup.

Aerial view of the new Pakenham Racecourse.

Kids race down the home straight at the annual Cardinia Shire Kids Day Out race meeting.

Captain Fancypantz strides to the line in the last Pakenham Cup to be held at the old racecourse.

Not ice of AGM

Commit tee

L i fe Members

Annual Report 2014

Pakenham Racing Club Life Members are Gavan Bourke, Kevin Clarke, Michael Moore, George Dore AM,Don Duffy, Ron Carroll & Frances Knaap

Yvonne Blackwood, Rick Tyrrell, Michael Hodge (CEO) Frances Knaap, Ron Carroll, Max Mitchell, George Dore,Simon Conn (Vice Chairman), Michael Duff, Don Duffy (Chairman)

Notice is given that the Annual General Meeting of Members of the Pakenham Racing Club Inc will be held on the following date, time and place.

DATE: Tuesday 2 December 2014 TIME: 6.30pm LOCATION: Pakenham Sports Club

6D Henry St Pakenham Victoria 3810

Agenda1. Confirm the minutes of the Annual General

Meeting held on 4 December 2013.2. Receive the Annual Report of the Club.3. Receive and consider the Annual Financial

Statements for the year ended 31st July 2014, together with the Auditor’s Report.

4. To elect three members of the Committee. Retiring Committee members Max Mitchell, Ron Carroll and Simon Conn have nominated for re-election. No other nominations were received and consequently the three retiring Committee are elected under the Rules.

5. To transact any other business relating to the affairs of the Club, of which due notice has been given, in accordance with the Rules of the Club.

Michael HodgeCHIEF EXECUTIVE

Racedates 14/15Thurs 26th March T The New Pakenham –

Grand OpeningSun 12th April T Cardinia Shire Community DaySun 26th April T Pakenham CupSun 17th May T Sunday RacingTues 26th May S Polytrack Grand OpeningThurs 4th June T Evergreen Turf RacedayTues 9th June S Member’s RacedayFri 19th June S APM Group RacedaySun 21st June T James Boag’s Grassroots

Footy DayFri 26th June S Racing Network RacedayFri 3rd July S Racing Network RacedaySun 5th July T Christmas in July RacedayFri 17th July S Racing Network RacedaySun 19th July T Sunday RacingTues 21st July S Midweek RacingTues 28th July S Seniors’ RacedayFri 31st July S Racing Network RacedayT = Turf S = Synthetic

Pakenham Racing Club Annual Report 2014 3

The 2013/2014 year has been one of growing excitement and anticipation as the relocation plans and vision set by the Committee over six years ago comes to fruition.

The enormous challenges presented by the relocation of the racecourse to Tynong have been recorded in my previous Annual Reports to members.

For the Committee and Club Managers it has been a long journey, and it is with great pride that I now present this Annual Report with the finish line clearly in sight.

Strong support for the new racecourse from the Racing Industry and the Victorian Government continues with the recent announcement of $4.5M of funding being provided towards the $9M Polytrack. I wish to thank Racing Victoria Ltd and Country Racing Victoria for their continued assistance, advice and support for the new racecourse development which will ultimately benefit not only the Club, but the Victorian Racing Industry as a whole.

The Club was also successful in its application for a $1M grant from the Victorian Government’s Living Victoria Grants Fund. This grant recognises “industry best practice” in relation to the extensive wetlands precinct at the new racecourse and is another example of the support from the Victorian Government.

The Club was delighted to have the Premier of Victoria and Minister for Racing, the Hon Dr Denis Napthine officially open the new racecourse for horse training on the 30 July 2014.

The Committee looks forward to the opening of the new racecourse for its first race meeting on 26 March 2015 and the first ever race meeting in Victoria on the Polytrack scheduled for 26 May 2015.

Notable events and highlights through the year included:-1. Approval by members of the new Club Rules.2. Life membership of the Club awarded to Frances

Knaap & Ron Carroll.3. Closure of the old Pakenham Racecourse on 21

Feburary 14 and transition to the new racecourse at Tynong.

4. The Club’s elevation to ‘Group A’ Race Club status.

5. The grant of $1M from the State Governments Living Victoria Grants fund, in recognition of the wetlands precinct ‘industry best practice” status.

6. Cardinia Shire approval of a Planning Permit, and Victorian Commission for Gambling and Liquor Regulation (VCGLR) approval of a gaming venue licence, for construction of the new hospitality and gaming venue at Cardinia Road, Officer.

7. Approval and introduction of extended trading hours (8am – 3am) for the Cardinia Club.

8. Completion of horse stalls, training tracks and other infrastructure required to commence horse training. Commencement of the Event Centre and Administration Building.

9. Uninterrupted progress with the racecourse construction and the meeting of its financial obligations.

10. The sale of 10 Trainer Allotments worth $2.6M and the commencement of construction of Stage 1 of the Knight’s Court trainer allotments.

11. Completion of the Evergreen Turf grass track.12. Appointment of Polytrack to build the Club’s

world class synthetic racing track.13. A visit by the Governor of Victoria Alex Chernov

to the new racecourse.14. A cash profit of $4.6M dollars (excludes grants).15. The Cardinia Club being awarded Best Family

Club by Community Clubs Victoria.

Chai rman’s Repor t

Annual Report 2014


Local trainer Cameron Templeton, jockey Damian Lane and connections of Captain Fancypantz celebrate the 2014 Sportingbet Pakenham Cup win.

I am able to report to the Members that all the Club’s strategic plans are well on track. The Club’s strong financial position is unprecedented with both gaming and racing performing well.

On the gaming front, the Club’s plans to relocate the Pakenham Sports Club venue to a site in Cardinia Road Officer made significant progress, with the Club obtaining the Council planning permit approval and the Victorian Commission for Gambling and Liquor Regulation approval for a gaming venue licence to operate 60 gaming machines. The Club continues to look to secure the $12M of funding required to build the venue.

On the Racing side, it was with sadness that we farewelled the old Pakenham racecourse with the final race meeting held on 14 February 2014. The penultimate race meeting on the 9th February 2014 was also the last ever Pakenham Cup at the old racecourse and it was a fitting tribute to farewell this iconic community venue with over 5,000 people in attendance.

I wish to acknowledge the tireless work being done by all Committee members. The Club continues to manage and deal with the complex business of building the new racecourse, as well as attending to its core business obligations of Racing and the operation of two hospitality / gaming venues. The Committees corporate governance responsibilities are considerable, as are their roles on the five Sub Committee’s that are individually covered in this annual report. I wish to pass on my appreciation to all Committee Members who give many hours of voluntary time to the Club’s business through their respective Committee and Sub Committee roles. I also thank Vice Chairman Simon Conn for his ongoing and valuable support.

Ron Carroll and Frances Knaap were awarded Life Membership of the Club at last years AGM in recognition of their outstanding contribution to the Club and more than 20 years of service as Committee members.

The Club’s Chief Executive Michael Hodge, pursues his role with great zeal and enthusiasm. His commitment to the vision of the Club is shared by the Club’s Financial Manager Paul Scanlon and Gaming Manager Brad Ford. Together they have produced excellent results for the Club and on behalf of the Committee I thank them for their commitment and assistance.

On a sad note, this racing season saw the passing of Norman Noel (NN) Webster. Noel served on the Club’s Committee for 5 years and was official timekeeper for many years. He was a long serving Club Member and a great supporter of the Pakenham Racing Club.

The racing season also saw the passing of Graeme McKnight our local Club Farrier and long time employee of Racing Victoria. Graeme was a passionate racing man and a great supporter of our Club over many years.

I commend this Annual Report to all Members, and encourage you to review in more detail the reports from the various Sub Committees.

Don DuffyCHAIRMAN


Premier Denis Napthine MP presents Chairman Don Duffy with the new Pakenham Racecourse licence.


Chief Execut ive ’s Repor t

6

The 2013/14 operational year is well covered by the Chairman and the respective reports that make up this year’s Annual Report. As such, my CEO’s report will focus more on progress with the Club’s 3 year strategic plan and its key objectives.

Strategic PlanThe Club has an ambitious and challenging 3 year Strategic Plan. This Plan has guided and served the Club extremely well over past years and will continue to do so for many more to come. It is pleasing that the Club continues to achieve its key strategic objectives year after year and, as evidenced by the Chairman’s report, 2013/2014 has been no exception. The following report provides Members with a ‘snapshot” of the key strategic challenges and objectives that the Club will continue to vigorously pursue over the next 3 years and beyond.

Brand With the pace of change and proposed expansion, the Club’s Brand is undergoing significant change and this is further enhanced with advanced information, technology and communications. With this in mind, the Club is positioning itself on a Brand and IT footing, that best serves the diverse and changing needs of the business. It also recognises the fact, that during the life of the current strategic plan, the Club will move to, and operate, 3 major sites. They are the current Cardinia Club site, the proposed Club Officer site and the new racecourse, which will become operational in March 2015. The Club has developed a brand architecture and customer offer that reflects the business needs of these 3 major sites, as well as a “leading edge” IT solution and communications that will support them. The Pakenham Racing Club is now structured along 3 distinct Business brands, being

1) Racing & Training2) Hospitality & Gaming3) Land Development

The Future of Hospitality & Gaming for Pakenham The Club is a leader within the Victorian gaming industry and has expanded its footprint with the acquisition of the Pakenham Sports Club some years ago. The Club has 143 gaming machine licences and has an outstanding expansion opportunity with its plans to build Club Officer. Club Officer will be a $15 million state of the art gaming & hospitality venue, in one of the fastest growing municipalities in Victoria. The expansion of the Club’s gaming footprint is a critical component of the Club’s strategic plan and its aspirations to be an Industry Leader in both the Victorian Racing and Gaming Industries.

When Club Officer is operational the Club’s cash profit is projected to be in excess of $8 million per annum. These profits will be reinvested back into the core business of racing and gaming / hospitality and will fuel the Club’s continued expansion plans.

The Future of Racing & Training for PakenhamI commend to members the Racecourse Development report on page 17, which provides a full overview of the achievements to date. The future is a very bright and exciting one for the Club, and we find ourselves in quite a privileged position in this regard. Our two key objectives are to capitalise on the elevation of the Club to ‘Group A’ Race Club status, and to continue to develop the Club into a Tier 1 Training venue. This is critically important as these are the pathways to premium racing and better race dates and racing opportunities.

With RVL approval of the 14/15 racedates, Pakenham has had its Group A race club aspiration confirmed. This is a critical milestone for the Club. Pakenham’s turf race meetings will be on the “showcase stakemoney” racedays of Thursdays and Sundays and as such, will feature higher stakemoney and showcase feature races.

The Club is currently in negotiation with RVL regarding 15/16 racedates. 39 race meetings are intended to be conducted at Pakenham in the 15/16 racing season. The Club could reasonably expect a further 10 race meetings transferred onto the synthetic track each year.

Racing on the Turf will be complemented by the Polytrack racing program and the Club is excited about being the first race club in Australia to be able to offer racing on the world renowned Polytrack surface.

On the Training front, the current draft RVL Industry Plan indicates that the Racing Industry will support and invest in Pakenham as a Tier 1 Training venue and this will ensure industry support for the future development of training infrastructure and facilities in accordance with the master plan. The Polytrack will be a mainstay feature of the Tier 1 Training facilities and it will be available to Trainers from March 2015.

Annual Report 2014


Pakenham CupThe Club will hold its next Cup meeting on Sunday 26 April 2015. The Club will then move its Cup meeting to the end of the Spring Carnival and will hold its 15/16 racing season Cup meeting on Sunday 29 November 2015. As such there will be two Pakenham Cups in the 2015 calendar year.

In the longer term, the Club has applied to RVL for a “stand alone” metropolitan Saturday Cup meeting in 2016, and has identified Saturday 26 November 2016 as the best option. It is no coincidence that the move to Sunday 29 November 15 is the same weekend as our target Saturday Cup meeting in 2016, which should assist our case.

Our new Cup date will be one week later than the 2015 Ballarat Cup which has just been afforded “stand alone” metro status. If successful in our application, the Club would leverage with the Ballarat Cup, to create two huge “regional” Cup meetings over two weeks, effectively extending the Spring Carnival by two weeks, to incorporate these two feature Cup meetings. It is expected that such a meeting would include stakemoney of $1million and the Club would look to invest in boosting its Cup stake, as well as the profile and reach of the Pakenham Cup. The Club will continue to lobby strongly to deliver this new look Pakenham Cup.

Night RacingRVL have recently published its draft 3 year Industry Plan for consultation. It is very pleasing to report to Members that Pakenham is identified as the choice of venue to expand the Victorian night racing circuit. Consistent with this, the Club is currently focused on design and funding issues and discussions with RVL continue. Members can be assured that this important strategic matter is well progressed and a key priority for the Committee.

Our TeamThe Club has a dedicated and talented group of Managers who are the driving force behind the Club’s continued operational performance and outstanding financial results. It is an exciting time to be a part of this Club and I thank all the Managers and Staff.

The agenda for the voluntary Committee of this Club is a large one, and I wish to thank each Committee Member for the generous time they devote to the governance of the Club, and the continued support they provide to the entire management team and staff.

Ian Virtue, Don Duffy and Premier Denis Napthine MP officially open the Horse Training Facilities at the new Pakenham Racecourse.

The Club owns substantial land holdings and has significant plans to develop and expand them. This is an exciting and important area of the Club’s business. The Finance & Audit Sub Committee are responsible for providing governance advice to the Committee on key strategic objectives in this area. The key deliverables relate to:

1) Trainer Allotments.2) Sale of 15 Chippendale Rd, Tynong. 3) Retail and Commercial precinct at the Pakenham

racecourse.4) Development of a motel on the Cardinia Club site.5) Sale of Cardinia Club land for a residential

development. 6) Construction of Club Officer at Cardinia Rd

Officer. 7) Masterplan Development of the Cardinia Club

site.

These 7 important issues are expanded on as follows

Trainer Allotments – Stage 1 Knight’s Court ReleaseAs part of the statutory planning outcome achieved by the Club at the new racecourse, 192 of the 608 acres was zoned by the Government for residential, retail and commercial development. 150 acres of the 192 has been set aside for the Trainer Allotments precinct.

As reported in last years annual report, the Club created an 18 Lot subdivision with a view to selling to Developers, Investors and/or Racing Industry participants for the purpose of building their own residence and stabling complexes, next door to a world class training and racing facility.

The “Knights Court release” hit the market in December 2013, as part of the Club’s extensive marketing campaign.

In an outstanding result for the Club, 10 allotments were sold prior to the subdivision commencing, and are currently “under contract”. The subdivision commenced in July 2014 at a cost of $2.2 million and is due for completion in Jan 2015, two months ahead of schedule and on budget. Following the completion of the subdivision, all contracts will “settle” and the owners will receive titles to their land. It is expected that some of the owners will commence immediate construction and the Club expects the first horse from a trainer allotment to be utilising the facility in early 2016.

Trainer Allotments – Stage 2Stage 2 of the Trainer Allotments precinct is a 32 acre parcel of land on the southern side of Stage 1. The Club has commenced negotiations with potential investors and Racing Industry participants in relation to the ideal plan of subdivision for this land. Integral to Stage 2 is provision of a 5 acre allotment designated for a “Pre Training” facility. This exciting

commercial opportunity is currently “at market” and the Club is negotiating with potential investors / developers. The “pre training” facility with water walker, treadmills, walkers, stabling and other related infrastructure, will provide alternative specialised services for racing industry participants and will enhance the Club’s training offer.

15 Chippendale Rd – TynongWhen the racecourse was rezoned to Special Use Zone, it was a requirement that the existing residential houses and all titles be consolidated into one land title, and this was the case with 15 Chippendale Rd.

The Club has since successfully negotiated with Council to create a new title of approx 6 acres incorporating the Sweeney house. This was allowed under the “existing use” rights afforded to the property and the house. The property was placed on the market and has been sold to a Trainer. The allotment must comply with all the conditions applicable to any Trainer Allotment within the 150 acre residential trainer allotments precinct.

Retail & Commercial precinct – Pakenham Racecourse42 acres of land is set aside for this precinct. Zoning specifically allows for activities designed to support and grow the racing and training operations as well as the employment opportunities that exist at this venue. This can be as diverse as Member’s Club/gaming facilities, veterinary precinct, educational facilities, transport hub, feed and produce retail outlet, etc. The Club continues to discuss various retail and commercial opportunities with potential providers.

Motel Development – Cardinia Club SiteThe Club is in contract negotiations with a Developer to sell land for the purpose of building a Motel. A Motel has always been a part of the Club’s master plan for the 3 hectare Cardinia Club site. A Motel will not only be a valuable asset for the Shire, but it has enormous business synergies with the hospitality / gaming venue. Together with extended trading hours for the Cardinia Club, this proposed motel development will significantly enhance the offer and the services to our Club members and their guests.

Sale of Cardinia Club land for a residential development The Club is in contract negotiations with a Developer to purchase land on the Cardinia Club site for the purpose of a residential sub division. This land is surplus to Club needs.


Annual Report 2014

Group 1 Developments Report

Club OfficerAs noted in the Chairman’s Report, significant progress was made again this year, with the approval of the Council planning permit in September 2013 and the approval by the VCGLR (Victorian Commission for Gambling & Liquor Regulation) in December 2013, of a gaming venue licence to operate 60 gaming machines at the Cardinia Rd Officer site.

The Club has secured $2.6m of funding for the land purchase from Places Victoria and it is expected that this sale will “settle” in early 2015. The final phase is tender and construction, and the Club continues to source / negotiate $12m in funding to enable the venue to be built. The Club Officer project remains a high priority for the Committee and the Club is committed to commencing construction in 2015 subject to funding considerations.

Masterplan Development of Cardinia Club siteWith the potential motel construction, a full review of the site master plan is currently being undertaken.

This includes the refurbishment of the Cardinia Club so as to maintain its high level of service for members and guests. As with Club Officer, the issue of funding dictates what is achievable. However, the immediate focus is the establishment of a master plan that will cater for such refurbishment, as well as the expansion of the site and proper functional synergy with the proposed motel next door.

Summary of Land SalesA summary of land sales and contract negotiations are as follows. Land sales and contract negotiations this year involve 14 properties and total approximately $5.3mill in income. All of these 14 properties have been sold / negotiated directly by the Club and involve no sales via Real Estate Agents or agent’s commissions / fees.

1) 10 Trainer Allotments totalling $2.6mill 2) 15 Chippendale Rd. Residence on 25,820 sq m3) Cardinia Club land for Motel. Residence on 4,287

sq m4) Cardinia Club land for residential development.

Land size 9,167 sq m


Raceday Services and Administration Building, due for completion January 2015

Racing Operations Sub Committee MembersRon Carroll – ChairmanFrances KnaapYvonne BlackwoodMark GrahamBrendan ShortHayley ConnMichael Hodge

RacingThis season saw the closure of the Pakenham racecourse. The last ever racemeeting conducted at the venue was on 14 Feb 2014. Whilst it was a condensed racing season of just over six months, the Club still managed to hold 12 meetings.

It will be a very different racing program at the new racecourse with the first ever race meeting scheduled for Thursday 26 March 2015. Racing will be conducted on both the turf track (8) and the Polytrack synthetic (9). Refer to page 3 for the calendar of race meetings for the 14/15 season.

Picnic RacingThe Pakenham Picnic Racing Club held it’s last ever picnic race meeting on New Years Day 2014. The members of the Picnic Racing Club subsequently resolved at a Special General meeting to “wind up” the Club.

Feature Race DaysThe Sportingbet Pakenham Cup was held on 9 February 2014 and $300,000 of Stakemoney was allocated across the 9 race program. Oaks Day and Caufield Guineas Day continue to be extremely successful for the Club with a total of approx 5,000 people attending both race meetings.

The Cardinia Shire “Kids Day Out” continues to develop as one of the Cardinia Shire’s key community events and approximately 2,000 people attended this meeting, the majority of which are local families, enjoying a “great day out”. The Club’s Christmas theme meeting on Friday 29 November 2013 was well attended and a successful meeting for the Club.

The Club’s feature race days, are a key factor in developing the brand of the Club as well as making a large contribution to the financial performance of Racing Operations. Total crowd attendance at Pakenham race meetings was 16,351 which is down on the previous years.

Feature Race Winners The Cameron Templeton locally trained Captain Fancypantz took out the last ever Pakenham Cup to be held at the old racecourse. Cameron also took out his second “Herb O’Neill Trainer of the Year” Award which capped off a stellar year for Cameron and his team. The Club also extends its congratulations to the connections of following feature race winners.

$100,000 Centrebet Pakenham CupWinning Horse: Captain FancypantzWinning Trainer: Cameron Templeton Winning Jockey: Damian Lane

$30,000 David Bourke MemorialWinning Horse: CateredWinning Trainer: Ciaron MaherWinning Jockey: Patrick Moloney

$30,000 M.J. Bourke HurdleWinning Horse: DownesWinning Trainer: Eric MusgroveWinning Jockey: Steven Pateman

2009/2010 2010/2011 2011/2012 2012/2013 2013/2014

RACE MEETINGS (TAB) 15 16 14 14 12

RACES 128 126 116 117 92

STARTERS 1,292 1,262 1,081 1,120 903

ON COURSE TURNOVER $1,043,182 $1,080,511 $948,998 $897,223 $652,892

OFF COURSE TURNOVER $16,376,983 $18,353,141 $16,050,922 $13,775,686 $11,888,484

Racing Operat ions Repor t


Annual Report 2014

Silverwater Resort Fashions on the Field - Pakenham Cup 2014

TurnoverThe table on page 10 compares performances over the past 5 years. On course turnover was down 27% on last year, whilst off course turnover continued a substantial declining trend, down another 14% on last year’s 14% decline. This demonstrates the challenge the industry and its joint venture partner Tabcorp has in winning market share back from the corporate bookmakers.

Financial PerformanceRacing Operations cash loss was $198,000 compared to $107,000 in 2012/13. The result was impacted by $90,000 paid to Evergreen Turf as part of their two year maintenance agreement to fully maintain the course proper. Rates and land tax costs were $115,000.

The Club looks forward to the different business model that can be employed at the new venue which includes a higher volume of racing, an event centre that can cater for 500 hundred in a sit down environment, more attractive training facilities, residences and stabling on site and a venue that is much more enticing for sponsorship and corporate support. With regards to key performance indicators the accompanying tables detail performance comparisons over the past 4 years. A summary of the key financial indicators is as follows:

• Raceday Packages income – Down from $363,000 to $329,000

• Sponsorship income – Down from $238,000 to $215,000.

• Admissions income – Down from $40,000 to $36,000 • Beverage Sales – Down from $131,000 to $115,000.

Raceday Packages income continues to decline and was down 9% on the back of a 20% decline the previous year. Profit from race day packages was $80,000, indicating that this important revenue area at the new racecourse will be a key management focus. Total attendance at the 12 race meetings was 16,351.

TrainingHorse Training concluded at the Pakenham racecourse on the 21 Feb 2014 and all Trainers had to be temporarily relocated to Moe and Cranbourne. The Club expresses its thanks and appreciation to the Cranbourne Turf Club and Moe Racing Club for hosting our Trainers. The Trainers were extremely well received and supported by both Clubs.

The new Pakenham racecourse was opened for horse training on 28 July 2014. It is expected that the number of horses trained, will increase to approximately 150 per day when opening times return to normal (4.30am to 9.30am). Hours are currently restricted due to the construction. Numbers are further expected to increase when the turf track opens for grass gallops (potentially Jan 15) and when the Polytrack is operational (March 2015). The first horses from the Trainer Allotments are expected in early 2016.

The Club enjoys a very productive working relationship with the Pakenham Trainers Association and extends its sincere thanks to President Dean Grass and Trainers’ Association committee members, for their contribution and co-operation throughout the season.

Pakenham Trainers AwardsFor the 13/14 racing season the awards were as follows.

Herb O’Neill Memorial Leading Pakenham Trainer – Cameron Templeton Leading Picnic Trainer of the Year – Kim & Gayle MayberryPakenham Horse of the Year – Godeera trained by Michael Phillips

Ron CarrollCHAIRMANRacing Operations

Admissions Revenue Race Day Packages Beverage Sales

Cardinia Club Net Profit On Course Attendance

Four Year Bar Sales PerformanceRaceday Packages

Beverage Sales

Cardinia Club EGM Revenue Admissions Revenue

$400,000

$600,000

$800,000

$1,200,000

$1,000,000

$1,400,000

2010/11 2011/12 2012/13 2013/14

$2,000,000$3,000,000$4,000,000$5,000,000$6,000,000$7,000,000$8,000,000$9,000,000

2010/11 2011/12 2012/13 2013/14

Four Year Bistro Sales Performance

Cardinia Club Wagering Commission

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

2010/11 2011/12 2012/13 2013/14

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

2010/11 2011/12 2012/13 2013/14

$1,500,000

$2,500,000

$3,500,000

$4,500,000

$5,500,000

$6,500,000

$7,500,000

2010/11 2011/12 2012/13 2013/14 2008/09 2010/112009/10

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

10,000

15,000

20,000

25,000

100,000150,000200,000250,000300,000350,000400,000450,000

60,00070,00080,00090,000

100,000110,000120,000130,000140,000

20,000

30,000

40,000

50,000

60,000

2011/12



Beverage Sales


$400,000

$600,000

$800,000

$1,200,000

$1,000,000

$1,400,000

2010/11 2011/12 2012/13 2013/14

$2,000,000$3,000,000$4,000,000$5,000,000$6,000,000$7,000,000$8,000,000$9,000,000

2010/11 2011/12 2012/13 2013/14



$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

2010/11 2011/12 2012/13 2013/14

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

2010/11 2011/12 2012/13 2013/14

$1,500,000

$2,500,000

$3,500,000

$4,500,000

$5,500,000

$6,500,000

$7,500,000

2010/11 2011/12 2012/13 2013/14 2008/09 2010/112009/10

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

10,000

15,000

20,000

25,000

100,000150,000200,000250,000300,000350,000400,000450,000

60,00070,00080,00090,000

100,000110,000120,000130,000140,000

20,000

30,000

40,000

50,000

60,000

2011/12



Beverage Sales


$400,000

$600,000

$800,000

$1,200,000

$1,000,000

$1,400,000

2010/11 2011/12 2012/13 2013/14

$2,000,000$3,000,000$4,000,000$5,000,000$6,000,000$7,000,000$8,000,000$9,000,000

2010/11 2011/12 2012/13 2013/14



$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

2010/11 2011/12 2012/13 2013/14

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

2010/11 2011/12 2012/13 2013/14

$1,500,000

$2,500,000

$3,500,000

$4,500,000

$5,500,000

$6,500,000

$7,500,000

2010/11 2011/12 2012/13 2013/14 2008/09 2010/112009/10

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

10,000

15,000

20,000

25,000

100,000150,000200,000250,000300,000350,000400,000450,000

60,00070,00080,00090,000

100,000110,000120,000130,000140,000

20,000

30,000

40,000

50,000

60,000

2011/12


Gaming Operations Sub Committee MembersMichael Duff – ChairmanYvonne BlackwoodDon DuffyBrad Ford

Financial PerformanceThe Cardinia Club continues to report strong profitability and posted a cash profit (depreciation excluded) of $4.739 million. The Pakenham Sports Clubs continues to be profitable and posted a cash profit (depreciation excluded) of $328,958.

These profit increases whilst down on last years record results, reflect the Club’s ability to maximise the opportunities since the change to the EGM’s licenses came into effect on 16 Aug 2012.

The 2013/14 year was full of challenges that impacted both venues. The Cardinia Club was required under law to introduce “Sign In” provisions, following a change of liquor license. This change to the liquor licence was a consequence of the Pakenham Race Course ceasing to operate at Racecourse Road, Pakenham.

There was also increased competition within the Shire that saw ownership changes to the two hotels that operate gaming machines in Pakenham. Further to this, the Pakenham Highway Hotel operated with 50 gaming machines (up from 32) for a full year for the first time.

The other key factor that effected gaming revenues was the State Government’s introduction of increased taxation rates from 1 May 2014. Whilst the impact was only 3 months of this year, the full 12 month impact will be felt in 14/15 and will result in the Club paying an additional $300,000 a year in tax.

In addition to increased taxes, the 14/15 year will see further challenges for both venues, when the Cardinia Hotel commences operation of its new 40 gaming machines. Further to that, the Pakenham Highway Hotel was recently granted approval to increase its gaming machines from 50 to 70 and this will occur in conjunction with a multi-million dollar renovation.

The threat of increased competition is ever present and well understood by the Club. It is one of the key drivers in the Club’s concerted push to build Club Officer. The Club is well advanced with its planning to keep the impact of revenue loss to a minimum over the course of the next twelve months and beyond. One of these initiatives is the increase in trading hours at the Cardinia Club from 1am to 3am.

Cardinia ClubThe 2013/14 year was a challenging year across all business departments with greater competition

existing in the local area. The overall management of each business department continued to improve, even in light of continued challenges regarding Intralot, the introduction of “Sign in” and the continued effect of the removal of ATM’s from gaming venues.

Gaming RevenueTotal gaming revenue (before Government tax) across all Victorian pubs and clubs increased only 0.56% during 2013/14 and this was on the back of a decrease of 7% the previous year. Once again the Cardinia Club’s total gaming revenue continued to outperform the State average, with an increase of 0.87% on last year. The Pakenham Sports Club’s gaming revenue continues to decline and was down 9% in 2013/2014 and 8% the previous year.

The Cardinia Club gaming revenue (after Government tax) grew by 2.2% to $6.449 mill compared to $6.310mill last year. This was a very positive result given the challenging environment outlined above. To offset this, the Club introduced extended trading hours on 1st December 2013 which provided an increase in revenue and turnover during the second half of the year. It would have been earlier if the Club did not have to go to VCAT to overturn the Council decision to refuse the planning permit application.

Club management continues to be supported by Momentum Gaming as the Club’s gaming services provider, and that relationship has helped minimise the impact of the Intralot issues and the introduction of “sign in” provisions. They have also assisted greatly in the analysis and planning for the upcoming introduction of Voluntary Pre Commitment and the potential of adding in-venue player loyalty.

Bistro and Bar RevenueThe Club’s bistro and bar departments again traded through difficult periods during 2013/14, and while unable to achieve last year’s results both the food and bar revenue continued to deliver additional revenue and profit towards the total Club result.

The Club’s bistro “Chives” and its associated revenue departments had a sales decline of only 1.28% on last year. This is a reflection of the increased competitive nature of food within the local area and the high standards of service and quality being delivered by the kitchen team led by Head Chef, Suresh Vaidyanathan, and Second Chef, Barbara Lithgow to keep the decline to such a low level. The introduction of new supplier tender process saw further improvement to the food margins with cost of sales at 31.83%.

The Bistro and Kitchen team will continue to implement and develop new bistro menus with a focus on value for money, presentation and seasonal changes/trends that better meet the needs of our members and customers.

Gaming Operat ions


Total bar sales declined 0.43% on last year consistent with the shift in customers drinking habits and evidenced by the reduction in average customer spend on beverages, compared to the previous years. The Club will continue its strict enforcement of responsible service of alcohol policy to ensure a safe and secure Club environment for all members, guests and staff. The Club entered into a new partnership with Lion Nathan. Under this new agreement the Club will receive increased financial rebates as well as improve the offer and value for money for Customers. Management continues to monitor beverage costs and associated margins, while still offering competitive pricing as well as discounts and rewards to our new Social Membership “Club Card”. This resulted in beverage margins for the full year achieving 28.23%.

TAB Wagering RevenueTotal TAB revenue was $155,270, a decline of 1.32% on last year and Keno revenue saw growth on last year at $11,134 for its second full year of trade. The split of the wagering & Keno sales is as follows.

1) Pari-mutuel wagering on racing - $3,831 mill (down 7.9%)

2) Fixed odds wagering on racing - $1,152 mill (up 24.4%)

3) Fixed odds wagering on sports - $405.6K (up 40.7%)4) Wagering on Trackside - $571.7K (down 5.4%)5) Keno Sales - $135.7K (up 25.5%)

Fixed odds racing and sports betting products have continued their growth during 2013/14 and now account for over 28.9% of total sales. This continues the trend of customers moving away from traditional pari-mutuel racing bet types to fixed odds wagering on racing and sport. Pari-mutuel wagering was again in decline on last year down 7.9% and total fixed odds wagering was up 24.4%. In comparison the growth of fixed odds betting on sports (live & Non-Live) saw Live Sports betting up 141.1% and Non-Live betting up 22.6%.

The continued growth of punters using EBT’s continued during the year to the point were 70.4% of all bets were performed via an EBT within the Club. As a result the Club, in conjunction with Tabcorp, was able to secure an additional EBT which has been located in our outdoor courtyard directly outside the TAB. This will keep pace with the ever growing demand from members and guests.

Extended Trading HoursAs reported last year, the Club was successful in its appeal to VCAT regarding the Council’s decision to refuse an extension of Cardinia Club trading hours from 8am to 3am. Following completion of the liquor license amendments, necessary to be able to trade the extended hours, the Club commenced trading the extended hours on the 1st December 2013. Over the next eight months with advertising and promotion of the new trading hours, the Club has

slowly seen an increase to both customer numbers and turnover/revenue at the Club. Over this period customer numbers increase on average between 150 to 200 customers per week and an average weekly turnover increase of over $30K.

New liquor licenseIn March 2014 the Cardinia Club implemented the required changes to its liquor licence, which required a change from an “On Premises” to “Full Club” liquor license. The legal flow on effect was that the Cardinia Club became a “sign in” venue for non members to gain access and use the facility. Whilst there were a number of challenges at the beginning, management focused heavily on a campaign to convert non members to members so as to alleviate the inconvenience to customers of having to “sign in”. This campaign proved very successful as the Club now has 7700 social membership, and this is an increase 50% on the previous year. The next challenge will be to ensure membership growth continues and current members renew their memberships each year.

Pakenham Sports ClubThe Pakenham Sports Club completed its fourth year of operation under the Cardinia Club management with the 2013/14 year providing considerable challenges due to the operating environment being experienced.

Gaming RevenuePakenham Sports Club’s total gaming revenue declined 9.76% on last year, but this would have been worse, if not for the improvement experienced in the second half of the year. The Pakenham Sports Club Gaming Machine revenue (after tax) was down 5.96%, or a decrease of $66,692 on last year. Unfortunately the decrease in revenue was a direct result of increased competition & an increase of EGM’s within the Cardinia Shire, and the change of ownership and/or operating models at local Hotels.


Gaming Manager Brad Ford and staff of the Cardinia Club accept the Best Family Club Award.

Bistro and Bar RevenueThe Pakenham Sports Club bistro and bar departments performed satisfactorily in the context of the local competition and the limited service that the Pakenham Sports Club can deliver.

In comparison with last year both the food and beverage revenue lines saw a sales decrease in both departments due to a decline of function bookings, and the difficulty in driving customer attendance and activity in the venue. Bistro sales declined 22.31% (on the back of last year’s record figures) and total bar sales decreased 12.24% due mainly to a decrease in functions on last year.

The Management will continue to implement new offers, promotions, and continue with successful past promotions with a focus on increasing both customer and member attendance over the next twelve months. This, of course, needs to be done in consideration of the impending relocation of the venue to Officer.

Cardinia Club & Pakenham Sports Club Industry Achievements During 2013/14 year both the Cardinia Club & Pakenham Sports Club have continued to receive industry recognition from the recently unified Clubs Victoria, and Community Clubs Association of Victoria under the new association, Community Clubs Victoria at their annual Awards event.

Cardinia Club Results

At a gala event on 21 October 14, Community Clubs Victoria (CCV) presented their 2014 Annual Awards and both gaming venues figured prominently in the nominations for awards as follows ;

Best Loyalty or Membership ProgramBest Club WebsiteBest Environmental Sustainability ProjectBest Keno ClubBest Cellar / Wine ListMetro Club Employee of the YearBest Gaming Club with less than 49 EGMsBest Welfare or Social Inclusion ProgramClub of the Year (with 10 or fewer employees)

A highlight of the awards was the presentation to Cardinia Club for the Best Family Club.

In presenting this award, CCV’s President Leon Wiegard, OAM, said “The Best Family Club win was made all the more impressive due to the large field of contestants. The judges agreed the Cardinia Club clearly fulfils the criteria of offering good facilities, entertainment and services for the breadth of ages amongst family groups. The Cardinia Club boasts a large kids room / playground which is much enjoyed by visiting children along with the pin ball machines, multi-player games etc.”

All of these nominations are a credit to the entire team at the Cardinia Club and Pakenham Sports Club. Management and staff are dedicated to our members and guests and committed to providing service excellence and a superior customer experience at both venues.




Beverage Sales


$400,000

$600,000

$800,000

$1,200,000

$1,000,000

$1,400,000

2010/11 2011/12 2012/13 2013/14

$2,000,000$3,000,000$4,000,000$5,000,000$6,000,000$7,000,000$8,000,000$9,000,000

2010/11 2011/12 2012/13 2013/14



$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

2010/11 2011/12 2012/13 2013/14

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

2010/11 2011/12 2012/13 2013/14

$1,500,000

$2,500,000

$3,500,000

$4,500,000

$5,500,000

$6,500,000

$7,500,000

2010/11 2011/12 2012/13 2013/14 2008/09 2010/112009/10

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

10,000

15,000

20,000

25,000

100,000150,000200,000250,000300,000350,000400,000450,000

60,00070,00080,00090,000

100,000110,000120,000130,000140,000

20,000

30,000

40,000

50,000

60,000

2011/12

Profit



Beverage Sales


$400,000

$600,000

$800,000

$1,200,000

$1,000,000

$1,400,000

2010/11 2011/12 2012/13 2013/14

$2,000,000$3,000,000$4,000,000$5,000,000$6,000,000$7,000,000$8,000,000$9,000,000

2010/11 2011/12 2012/13 2013/14



$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

2010/11 2011/12 2012/13 2013/14

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

2010/11 2011/12 2012/13 2013/14

$1,500,000

$2,500,000

$3,500,000

$4,500,000

$5,500,000

$6,500,000

$7,500,000

2010/11 2011/12 2012/13 2013/14 2008/09 2010/112009/10

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

10,000

15,000

20,000

25,000

100,000150,000200,000250,000300,000350,000400,000450,000

60,00070,00080,00090,000

100,000110,000120,000130,000140,000

20,000

30,000

40,000

50,000

60,000

2011/12

Gaming Revenue



Beverage Sales


$400,000

$600,000

$800,000

$1,200,000

$1,000,000

$1,400,000

2010/11 2011/12 2012/13 2013/14

$2,000,000$3,000,000$4,000,000$5,000,000$6,000,000$7,000,000$8,000,000$9,000,000

2010/11 2011/12 2012/13 2013/14



$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

2010/11 2011/12 2012/13 2013/14

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

2010/11 2011/12 2012/13 2013/14

$1,500,000

$2,500,000

$3,500,000

$4,500,000

$5,500,000

$6,500,000

$7,500,000

2010/11 2011/12 2012/13 2013/14 2008/09 2010/112009/10

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

10,000

15,000

20,000

25,000

100,000150,000200,000250,000300,000350,000400,000450,000

60,00070,00080,00090,000

100,000110,000120,000130,000140,000

20,000

30,000

40,000

50,000

60,000

2011/12

Bar Revenue



Beverage Sales


$400,000

$600,000

$800,000

$1,200,000

$1,000,000

$1,400,000

2010/11 2011/12 2012/13 2013/14

$2,000,000$3,000,000$4,000,000$5,000,000$6,000,000$7,000,000$8,000,000$9,000,000

2010/11 2011/12 2012/13 2013/14



$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

2010/11 2011/12 2012/13 2013/14

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

2010/11 2011/12 2012/13 2013/14

$1,500,000

$2,500,000

$3,500,000

$4,500,000

$5,500,000

$6,500,000

$7,500,000

2010/11 2011/12 2012/13 2013/14 2008/09 2010/112009/10

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

10,000

15,000

20,000

25,000

100,000150,000200,000250,000300,000350,000400,000450,000

60,00070,00080,00090,000

100,000110,000120,000130,000140,000

20,000

30,000

40,000

50,000

60,000

2011/12

Bistro Revenue



Beverage Sales


$400,000

$600,000

$800,000

$1,200,000

$1,000,000

$1,400,000

2010/11 2011/12 2012/13 2013/14

$2,000,000$3,000,000$4,000,000$5,000,000$6,000,000$7,000,000$8,000,000$9,000,000

2010/11 2011/12 2012/13 2013/14



$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

2010/11 2011/12 2012/13 2013/14

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

2010/11 2011/12 2012/13 2013/14

$1,500,000

$2,500,000

$3,500,000

$4,500,000

$5,500,000

$6,500,000

$7,500,000

2010/11 2011/12 2012/13 2013/14 2008/09 2010/112009/10

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

2010/11 2011/12 2012/13 2013/14

10,000

15,000

20,000

25,000

100,000150,000200,000250,000300,000350,000400,000450,000

60,00070,00080,00090,000

100,000110,000120,000130,000140,000

20,000

30,000

40,000

50,000

60,000

2011/12

TAB Commission

Finance, Audi t & Corporate GovernanceFinance & Audit Sub Committee MembersRick Tyrrell – ChairmanSimon Conn Don DuffyMichael HodgePaul Scanlon

Financial PerformanceThe 2014 financial year was another strong year of financial performance with an operating cash profit of $5.64m. This result was boosted by the receipt of a $1 million capital subsidy from Racing Victoria.

The normalised cash earnings, with the removal of this grant, reported were $4.64m, down $586,000 on last year’s record result. All departments reported a drop in their cash profitability for a variety of reasons including reduced interest income with less cash on deposit, reduced gaming revenue due mainly to an increase in gaming tax and higher labour costs in Racing Operations.

In addition, an extraordinary loss of $1.5m was booked in relation to buildings, fixtures and fittings retained at 61 Racecourse Rd when it was vacated in February 2014.

Balance SheetThe Club’s Balance Sheet altered considerably during the year, with the proceeds of the racecourse sale being fully expended on the new racecourse development which made a corresponding increase in “Works in Progress”, which rose from $21.8m to $48.8m. The Club’s total asset base now exceeds $75.5m which provides a great platform for pursuing the various medium term strategic objectives.

Borrowings were only up $670,000 from the 2013 year to $13.5m. An increase in borrowings will occur in 14/15 and debt will peak in April 2015, consistent with final payments to contractors upon completion of the new racecourse.

Future ProfitabilityWith two consecutive years in excess of $5m in cash profit, this is now the new baseline for the Club’s profitability. The forecast cash profit for 2014/15 is $6.75m (which includes a further capital subsidy of $2.75m from Racing Victoria) and, at 31 October 2014, the Club is on budget to deliver this.

The 40 race meetings programmed for the racecourse from 2015/16 onwards and the potential for Club Officer to come on line in the next few years will further underpin the growth in the Club’s profitability going forward.

Government & Industry FundingBelow is a summary of approved funding grants.

1) Synthetic Track - $3m grant from the State Government’s Victorian Racing Infrastructure Fund (VRIF)

2) Synthetic Track - $1.5m grant from RVL / CRV Infrastructure fund.

3) Racecourse Relocation - $2.25m from Racing Victoria

3) Wetlands - $1mill grant from the Vic Government’s Living Victoria Fund.

4) Barriers – $57,000 from both Racing Victoria and State Government’s VRIF

5) Big Screen – $140,000 from State Govt‘s VRIF6) Course Proper Running Rail – $75,000 from Racing

Victoria and $105,000 from State Government’s VRIF

These grants clearly demonstrate the support of the Government and the Racing Industry and they are testament to the position and status that this new facility has achieved.

10/11 11/12 12/13 13/14

ProfitperFinancials $1,850,000 $1,791,000 $28,135,000 $3,058,000

Depreciation $437,000 $301,000 $945,000 $1,059,000

Loss/(Profit)onsaleofRacecourse Nil Nil ($23,853,000) $1,524,000

Less: Grants Nil Nil Nil $1,000,000

CashProfit(excludesaboveitems) $2,287,000 $2,092,000 $5,227,000 $4,641,000

$improvement $268,000 ($195,000) $3,135,000 ($586,000)

% Increase 13% (8%) 150% (11%)


Annual Report 2014

Capital Expenditure ProgramGiven the Club’s ambitious expansion plans it is important that appropriate funding is secured to assist in delivering these strategic objectives. During the 2014 year, the Club was successful in obtaining an additional $5.85 million of loan funding approvals as follows:• $1.25m to assist with the Synthetic track build• $2.25m to fund Stage 1 of the Trainer Allotment

subdivision• $2.35m to assist in the delivery of the general

racecourse development

These limits were on top of the $30m of previously approved limits and the Club is appreciative of the ongoing support and partnership of the NAB.The $12 million required to fund the Club Officer construction remains unfunded. The Club is hopeful of being able to secure this funding prior to the end of 14/15 financial year.

Corporate GovernanceThe Committee governs the affairs of the Club via the following Corporate Governance Structure:1) PRC Committee.2) Club Executive.3) Finance & Audit Sub Committee.4) Racing Operations Sub Committee.5) Gaming Operations Sub Committee.6) Community Relations Sub Committee.7) Relocation Sub Committee.

All of these above Sub Committees meet frequently and are supported by Management in administration of the Club’s business and preparation of minutes at all meetings.

Committee Meeting Attendance

Full Committee Meetings Meetings Held Attended Don Duffy 12 11 Simon Conn 12 8 Yvonne Blackwood 12 10 Ron Carroll 12 11 George Dore 12 12 Michael Duff 12 9 Frances Knaap 12 10 Max Mitchell 12 12 Rick Tyrrell 12 11

In addition to the above full Committee meetings there were the following formal sub committee meetings held during the 2013 / 2014 year

Finance & Audit 8 Relocation 35 Gaming Operations 12 Racing Operations 9 Community Grants 11


Aerial view of the new Club Officer site, Cardinia Road, Officer, overlaid with an artist impression of the venue

Racecourse DevelopmentRacecourse Development Sub CommitteeGeorge Dore – ChairmanMax MitchellDon DuffySimon ConnRon CarrollPaul ScanlonMark GrahamMichael Hodge

Construction progressConstruction at the new racecourse officially commenced on 6 August 2012. This year saw the completion of the horse training facilities consisting of the horse stalls, tunnels, sand tracks and all other infrastructure needed to get horse training operational. The Club was delighted to achieve this important milestone, and have the Premier of Victoria and Racing Minister, the Hon Dr Denis Napthine officially open the new racecourse for horse training on the 30 July 2014.

The focus is now on completion of the customer facilities in preparation for our opening race meting scheduled for 26 March 2015. The Club remains “on track” to complete the event centre in time for the first race meeting. The raceday services & administration building will be completed ahead of schedule and will be “handed over” to the Club in January 2015.

Turf TrackAs well as completing the horse training facilities, the past year also saw the completion of the most critical aspect of the entire development, the turf track. A 2400m track with a “binder reinforced” turf profile, this track will give the Club a huge advantage over other Clubs, in the critical areas of drainage and track stability. The Club is confident that the racing surface and the superior track design will enable the Club to deliver on its claim of being a “world class” racetrack. Having completed the turf track, Evergreen Turf are now contracted to maintain and prepare the turf in readiness for its inaugural race meeting on 26 March 2015. The first horses are expected to “grass gallop” on the new turf in January 2015.

‘Polytrack’ Synthetic TrackConstruction of the Polytrack commenced on 30 Oct 2014 in another major milestone for the Club and the new racecourse. The Club completed the tender negotiation phase, and after extensive due diligence, the contract was awarded to Polytrack. Polytrack is a world renowned synthetic racing surface, and the Club is delighted to be installing a Polytrack, which will be a perfect complement to the turf track.

Turf Track & Polytrack The Club has invested approx $20 million in the turf track and the Polytrack. It is testament to the importance placed by the Committee on these two race tracks and the manner in which they underpin so much of this development, as well as the strategic future of this Club and the venue.

There are very few venues that can claim to have a superior combination of turf track and synthetic track, and Member’s should be very proud of what has been accomplished in this regard. Strategically, they offer a “brave new world” for the Pakenham Racing Club and underpin the following achievements.

1) They provide increased racing opportunities. There will be 24 turf track meetings and 16 synthetic track meetings annually. In addition to that there will be relocated race meetings.

2) Both tracks are critical for horse training activities. The venue cannot achieve Tier 1 Training venue status without a synthetic track.

3) They significantly improve training facilities and enhance the value and saleability of the trainer allotments.

4) They provide for more racing and that in turn generates more profit for the Club’s racing operations. It is a better business model for the Club.

5) Both tracks provide the best option for RVL to expand night racing. As part of the master plan, lights have been designed and conduits laid, so neither track is impacted when lighting cables are installed.

FundingFunding remains a continual challenge for the Club, as does managing the typical cost variations a project of this size encounters. The racecourse project is now a $72 million major development with the synthetic track ($9m) and Trainer Allotments ($2.2m) now brought forward into the Stage 1 build and Development Budget. Cost variations amount to approx $4 million, the majority of which has been funded by the original budget contingency, trainer allotment sales, other property sales and grants.

The scale and scope of this project has not been attempted before in Victorian Racing, in a time frame of two and half years. It makes this project unique and throws up many complex challenges on a regular basis. The Club remains well placed to deal with the funding requirements and challenges of this project.

Annual Report 2014


Trainer Allotments and Retail & Commercial precinctOf the 608 acres of the new racecourse, 192 acres is set aside for Trainer Allotments and Retail & Commercial precincts. The Club’s strategic plans for these precincts are covered in the Group 1 Developments section of this annual report. The trainer allotments and the retail / commercial precincts are unique to the Pakenham racecourse. It stamps the venue as a truly integrated facility where retail, commercial and residential development are designed to perfectly complement, and enhance the racing and training core business of the Pakenham Racing Club and the “offer” the venue provides for Stakeholders. These precincts are also critical to the Club’s objectives to create a thriving employment hub and drive economic development for the racing industry and the Cardinia Shire.

Wetlands PrecinctMembers would be well aware of the investment by the Club in the wetlands and water security initiatives provided by the wetlands system. The wetlands involve the latest water harvesting technology and provides for 35 megalitres of storage capacity effectively ‘drought proofing” the venue for the purposes of racing and training. The “industry best practice” nature of the wetlands precinct was formally recognised by the Victorian Government when the Club was successfully awarded a $1million grant through the Office of Living Victoria Grants Fund. This $1mill grant was formally announced on site by the Member for Narracan Gary Blackwood MP on 7 Nov 2014, and the Club appreciates the continued support of the State Government of Victoria.

OH&S and risk managementIt is important to recognise that the training facilities are a place of employment and that the nature of horse training is high risk. The Club is committed to building facilities that are a significant improvement on the standard currently offered across Victoria.

Given there is not excepted to be more than 150 - 200 horses in work, in the first 12 months of operation, the 3 spacious training tracks (two sand and a 2000m Polytrack) will more than adequately cater for the horse traffic and will significantly reduce the inherent risk to Track Riders and other users.

This greatly improved OH&S compliance together with under cover horse stalls, will deliver a greatly improved workplace and working environment for all Industry participants who utilise this facility. Management of risk and the safety of the venue will be of the highest priority for the Club.

SummaryThe Racecourse Development is an enormous project requiring the engagement of many specialist consultants and I wish to acknowledge the work done by the Project Managers Pizzey Noble, ISG Projects and Daltons Consulting Engineers, and the various lead consultants. The majority of construction has been delivered and managed by McMahon’s and the APM Group, who both deserve special recognition for the great job they are doing.

George DoreCHAIRMANRacecourse Developement Sub Committee

Pearse Morgan, RVL Director, Lance McMillan, CRV Chairman, Gary Blackwood MP, Member for Narracan, Don Duffy, PRC Chairman and Graeme Moore, Mayor Cardinia Shire at the announcement of the $1 million grant for the Wetlands Precinct.


Community Grants Sub Committee MembersFrances Knaap – ChairpersonRon CarrollMichael HodgeJake Dwyer

Community Benefits StatementThe Gambling Regulation Act 2003 requires club venue operators who receive gaming revenue to lodge a Community Benefit Statement. Under the guidelines set by the Act, the Pakenham Racing Club’s total community benefit for the year was $1.768 million. This represented 17% of gross gaming revenue.

Community & Business PartnershipsThe Club has worked diligently to develop and grow its Business & Community Partnerships as a way of enhancing its Event Day Race Meetings. Significant partnerships exist with:

Cardinia Shire - Kids Day OutPakenham Gazette - Oaks DayEvergreen Turf - Caulfield Guineas DayCora Lynn Football & Netball Club - Cup Day

Community AwardsAt the 2014 Community Clubs of Victoria Awards, the Cardinia Club was awarded “Best Community Club” and this further recognises the community contribution made by the Pakenham Racing Club and the work being done through the Community Grants fund which is supporting so many worthwhile and important community organisations and Clubs.

Community Grants FundsThe Club has a Community Grants Fund designed to provide financial assistance to local community groups and individuals. Application forms are available on the Cardinia Club website and the Club received 82 Applications for the year.

Some of the community groups and individuals who benefited from the Fund are as follows:

Cora Lynn Football Club - $5,864Gembrook Football Club - $5,000Cardinia Combined Churches Caring - $4,500Pakenham Picnic Racing Club - $4,000Garfield Football Club - $3,000Cardinia Foundation - $2,545Cardinia Shire Carols by Candlelight - $2,000St. Thomas Aquinas College - $1,500P.B. Ronald Memorial Trust - $1,500Cobra Juniors F.C. - $1,000Pakenham Golf Club - $1,000St. Francis Xavier Old Collegian FC - $1,000Pakenham Show Society - $1,000Upper Beaconsfield Men’s Shed - $950Cystic Fibrosis Victoria - $909Yakerboo Festival - $909Cardinia Beaconhills Golf Links - $900Lakeside Community Development Fund - $500Bayles Fauna Park - $500Nar Nar Goon Kindergarten - $500Cockatoo Men’s Shed - $500Pakenham Baseball Club - $500Parkrun Pakenham - $500Cancer Council Victoria - $455Koo Wee Rup Football Club - $300Homegarth Community Kindergarten - $250Lang Lang Pastoral Agricultural Association - $250Bharatha Kalanjali Dance School - $250Pakenham Agricultural and Horticultural Society - $220Lang Lang Pre School - $200Inner Wheel Club of Pakenham - $200Tynong Tennis Club - $200Pakenham Bowls Club - $150Cardinia Waters Bowls Club - $100Koo Wee Rup Bowls Club - $100

The Club’s grants allocation for the year totalled $43,252.

Frances KnaapCHAIRMANCommunity Grants Sub Committee

Don Duffy, PRC Chairman presents Team on the Turf winners Gembrook Cockatoo Football & Netball Club with a $5,000 cheque

Communi ty Benef i ts Repor t

Annual Report 2014


Underpinning the Pakenham Racing Club’s Business and Racecourse Relocation Masterplan are the following 12 Key Pillars:

2.Tier 1 Training facilities that, when fully developed, will potentially provide capacity for up to 1,000 horses using the facility daily.

3. Premium grass track racing on a world class 2400m,

hosting at least 24 race meetings per annum.

4. A world class 2000m synthetic track with 1400m & 1600m chutes to facilitate all standard race starts.

6.Night racing capability.

7. Environmentally sustainable and completely drought proofed racecourse with industry best practice water harvesting techniques.

9. A thriving employment precinct.

10. An equine related commercial and retail precinct that is complementary to racing and training activities at the site.

11. sustainable business model for all stakeholders who use the facility.

5. A venue approved to deliver a minimum 40 race meetings per annum on grass and synthetic tracks.

8. A 150 acre trainer allotment precinct that provides a unique business

improved business outcomes for trainers, their families and their employees.

The Masterplan also provides for the following training facilities to be developed in future stages; • 1800m inner turf track for regular training use including jump outs and trials• Provision to build uphill training tracks• Equine pools• Jogging and walking Tracks• Stripping Stalls in line with capacity demand

1.608 acre site to expand and grow future infrastructure and facilities.

12. Alternative Club income streams from Gaming Operations to invest in and keep growing the facilities.


1

21

Statement of Comprehensive Incomefor the year ended 31 July 2014

The accompanying notes form part of this financial report

2014 2013Note $ $

Revenue from ordinary activties 2 13,371,183 12,642,113

Employee benefits expense (3,668,708) (3,359,438)

Finance Costs 3 (6,078) (4,490)

Depreciation and amortisation expense 3 (1,058,567) (945,025)

Other expenses from ordinary activities 3a (4,073,741) (4,068,445)

Profit before income tax 4,564,089 4,264,714

Profit/(Loss) on Racecourse Relocation 2(a) (1,523,919) 23,853,064

Income tax expense 1(a) - -

Profit from operations 3,040,170 28,117,778

Other Comprehensive Income

Items that will not be reclassified to profit or loss

Items that will be reclassified subsequently to profit or losswhen specific conditions are met

17,904 17,904

Total comprehensive income for the year 3,058,074 28,135,682

Total comprehensive income attributable to members of the entity 3,058,074 28,135,682

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOMEFOR THE YEAR ENDED 31 JULY 2014

PAKENHAM RACING CLUB INCORPORATED



Statement of F inancia l Pos i t ion

22

for the year ended 31 July 2014


Annual Report 2014

2014 2013Note $ $

Current AssetsCash and Cash equivalents 5 599,669 18,132,229 Trade and Other receivables 6 439,802 286,191 Inventories 7 65,292 68,021 Other Current Assets 8 71,516 87,116 Total Current Assets 1,176,279 18,573,556

Non-Current AssetsOther Financial Assets 9 71,902 71,902 Property, plant and equipment 10 74,340,189 49,831,365 Total Non-Current Assets 74,412,091 49,903,267

Total Assets 75,588,370 68,476,824

Current LiabilitiesTrade and Other Payables 11 5,723,285 1,444,174 Income in Advance 12 1,267,873 1,262,794 Short term Borrowings 13 54,776 53,478 Provisions 14 336,949 288,425 Total Current Liabilities 7,382,883 3,048,871

Non-Current LiabilitiesTrade and Other Payables 11 1,388,639 2,009,865 Long term Borrowings 13 13,534,538 12,865,363 Provisions 14 51,552 66,028 Total Non-Current Liabilities 14,974,729 14,941,257

Total Liabilities 22,357,612 17,990,127

Net Assets 53,230,758 50,486,696

EquityReserves 15 2,552,250 2,866,262 Retained Earnings 50,678,508 47,620,434 Total Equity 53,230,758 50,486,696

STATEMENT OF FINANCIAL POSITIONAS AT 31 JULY 2014




1

23

Statement of Changes in Equityfor the year ended 31 July 2014


Revaluation CapitalRetained Surplus GrantEarnings Reserve Reserve Total

2013

Balance at beginning of the financial year 19,484,753 32,366,753 345,477 52,196,983 Profit/(loss) attributable to members 28,117,778 - - 28,117,778 Revaluation Increment/(Decrement) - (29,828,064) - (29,828,064) Other comprehensive Income/(Expenses) 17,904 - (17,904) -

Balance at end of the financial year 47,620,435 2,538,689 327,573 50,486,697

Revaluation CapitalRetained Surplus GrantEarnings Reserve Reserve Total

2014

Balance at beginning of the financial year 47,620,435 2,538,689 327,573 50,486,697 Profit/(loss) for the year 3,040,169 - (296,108) 2,744,061 Revaluation Increment/(Decrement) - - - - Other comprehensive Income/(Expenses) 17,904 - (17,904) -

Balance at end of the financial year 50,678,507 2,538,689 13,561 53,230,758


STATEMENT OF CHANGES IN EQUITYFOR THE YEAR ENDED 31 JULY 2014



Cash F low Statement

24

for the year ended 31 July 2014


Annual Report 2014

2014 2013Note $ $

Cash Flows From Operating Activities

Receipts from racing and gaming activities 13,032,846 12,079,652 Payments to suppliers and employees (8,020,576) (6,882,833) Net Receipt / (Payment) to / (from) ATO for GST (70,117) 42,006 Interest received 343,361 565,528 Interest Paid (6,078) (4,490)

Net cash flows from/(used in) operating activities 19 5,279,437 5,799,863

Cash Flows From Investing Activities

Payments for property, plant and equipment (23,498,644) (16,420,417) Proceeds from sale of property, plant and equipment 16,173 21,575,000

Net cash flows from/(used in) investing activities (23,482,471) 5,154,584

Cash Flows From Financing Activities

Proceeds from Borrowings 670,473 1,901,091

Net cash flows from/(used in) financing activities 670,473 1,901,091

Net increase/(decrease) in cash held (17,532,561) 12,855,537

Cash at the beginning of the financial year 18,132,230 5,276,692

Cash at the end of the financial year 5 599,669 18,132,230


STATEMENT OF CASH FLOWSFOR THE YEAR ENDED 31 JULY 2014



1

25

Notes to the F inancia l Statementsfor the year ended 31 July 2014PAKENHAM RACING CLUB INCORPORATED

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JULY 2013

NOTE 1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIESThe financial report covers Pakenham Racing Club Inc as an individual entity. Pakenham Racing Club Inc.is an association incorporated in Victoria under the Associations Incorporation Reform Act (Victoria) 2012.

This Financial Statement is a general purpose Financial Report, which has been prepared in accordance withAustralian Accounting Standards - Reduced Disclosure Requirements and the requirements of the Associations Incorporation's Reform Act 2012. The Financial Report is prepared on an accrual basis and is based on historical costs and does not take into account changing money values. Cost is based on the fair values of the consideration given in exchange for assets. The accounting policies have been consistently applied, unless otherwise stated.

The following is a summary of the material accounting policies adopted by the Association in the preparation ofthe financial statements.

Pakenham Racing Club Inc. is exempt from income tax under Section 50-45 of the Income Tax Assessment Act 1997.

(b) Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except where the amount of GST incurred is not recoverable from the taxation authority. In these circumstances, theGST is recognised as part of the cost of acquisition of the asset or as part of the expense.

Receivables and Payables are stated with the amount of GST Included

The net amount of GST recoverable from, or payable to, the ATO is included as a current asset or liability in theStatement of Financial Position. Cash flows are included in the Statement of Cash Flows on a net basis.

(c) Employee benefits

Provision is made for the Club's liability for employee benefits arising from services rendered by employees to balance date. Employee benefits expected to be settled within one year together with benefits arising from wagesand salaries, annual leave and sick leave which will be settled after one year, have been measured at theirnominal amount. Other employee benefits payable later than one year have been measured at the present valuesof the estimated future cash outflows to be made for those benefits.

Contributions are made by the Association to an employee superannuation fund and are charged as expenses when incurred.

(d) Provisions

Provisions are recognised when the economic entity has a legal, equitable or constructive obligation to make afuture sacrifice of economic benefits to other entities as a result of past transactions or other past event, it isprobable that a future sacrifice of economic benefits will be required and a reliable estimate can be made of the amount of the obligation. Employee provisions are measured based on remuneration rates expected to be paidwhen the liability is settled.

(e) Property, plant and equipment

Plant and equipment are brought to account at cost or fair value, less where applicable, any accumulated depreciation or amortisation and impairment losses.

Items of property, plant and equipment, including buildings but excluding freehold land, are depreciatedover their useful life to the entity commencing from the date of acquisition/revaluation. Allproperty, plant and equipment is depreciated using the straight line method.

Class of Asset Depreciation Rate

Motor vehicles 10% - 20%Office Equipment 20.0%Computer Equipment 33.3%Fixtures and Fittings 10% - 33%Track improvements 2.5% - 10%Buildings & Grandstands 2.5% - 10%Plant & equipment 5% - 33%

(a) Income Tax

Basis of Preparation


Notes to the F inancia l Statementsfor the year ended 31 July 2014

Annual Report 2014


NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 JULY 2013

Initial recognition and measurement

Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions to the instrument. For financial assets, this is equivalent to the date that the association commitsitself to either purchase or sell the asset (ie trade date accounting is adopted).

‘at fair value through profit or loss’ in which case transaction costs are expensed to profit or loss immediately.

Finance instruments are subsequently measured at either fair value, amortised cost using the effective interest rate method or cost. Fair value represents the amount for which an asset could be exchanged or a liability settled, betweenknowledgeable, willing parties. Where available, quoted prices in an active market are used to determine fair value.In other circumstances, valuation techniques are adopted.

(f) Impairment of assets

At each reporting date, the Association reviews the carrying values of its tangible and intangible assets to determinewhether there is any indication that those assets have been impaired. If such an indication exists, the recoverableamount of the asset, being the higher of the asset’s fair value less costs to sell and value-in-use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expenses to theincome statement.

(g) Cash and cash equivalents

Cash on hand and in banks are stated at nominal value. Bank overdrafts are shown within borrowings in currentliabilities on the balance sheet.

For the purposes of the Statement of Cash Flows, cash includes cash on hand and in banks, net of outstanding bankoverdrafts and loans.

(h) Comparative figures

Where required by Accounting Standards comparative figures have been adjusted to conform with changes inpresentation for the current financial year.

(i) New accounting standards for application in future periods

The AASB has issued new and amended Accounting Standards and Interpretations that have mandatory applicationdates for future reporting periods and which the association has decided not to early adopt.

(j) Revenue

Income is recognised as revenue to the extent that it is earned. Unearned income at the reporting date is reported as such.

All revenue is stated net of the amount of goods and services tax (GST)

The association has adopted the following accounting standard for application on or after 1 August 2006:

AASB 1004: ContributionsThe changes resulting from the adoption of AASB 1004 relate primarily to the recognition of capital grantsas revenue. That is such grants in the past were recorded as a reserve, then recognized progressively asincome over the life of the asset since that date, new capital grants are recorded as income.

As noted above the adoption of AASB 1004 will result in material differences in the recognition andmeasurement of the Association's pre 1st August 2006 revenue. The Association has elected not toadjust comparative information resulting from the introduction of AASB 1004. As such, previous accounting policy will continue to be applied to prior capital grants.

2014 2013$ $

NOTE 2. REVENUE AND OTHER INCOMERace Day Revenue 747,293 763,318 Gaming & Wagering 7,668,713 7,596,289 Bar & Bistro 2,817,319 2,879,754 Sponsorship 215,717 238,098 Industry Funding 1,500 1,500 Interest Received 343,361 565,528 Lease & Rent Received 29,985 36,604 Other Income 275,795 335,522 Capital Grant - RVL 1,000,000 - Training Track subsidy 271,500 225,500

Total Revenue from ordinary activities 13,371,183 12,642,113

(a) Profit/(Loss) on Racecourse RelocationThis amount represents the loss on fixed assets related to the vacation of 61 Racecourse Rd in February 2014.

Financial instruments are initially measured at fair value plus transaction costs except where the instrument is


1Notes to the F inancia l Statementsfor the year ended 31 July 2014



2014 2013$ $

NOTE 3. EXPENSESDepreciation and amortisation of non-current assets:

Depreciation & Amortisation 1,058,567 945,025

Finance costs 6,078 4,490

(a) Other expenditureRace day Expenditure 472,083 549,586 Gaming Expenses 634,199 575,537 Bar & Bistro 987,342 1,046,669 Marketing 52,951 44,007 Stakes & Trophies 7,580 6,979 Racecourse Maintenance 254,121 206,791 Administration Expenses 1,665,465 1,638,876

4,073,741 4,068,445

NOTE 4. AUDITORS' REMUNERATIONRemuneration of the auditor of the Club for auditing or reviewingthe financial report is payable by Racing Victoria Limited

NOTE 5. CASH AND CASH EQUIVALENTSCash at bank 414,655 936,593 Cash on hand 185,014 195,637 Cash on deposit - 17,000,000

599,669 18,132,229

NOTE 6. TRADE AND OTHER RECEIVABLESTrade debtors 150,789 43,507 Provision for impairment - -

150,789 43,507 Sundry debtors 289,012 242,684

439,802 286,191

Current trade receivables are generally 30 day terms. These receivables are assessed for recoverability and a provision for impairment is recognised when there is an objective guidance that an individual trade receivable is impaired.It is expected that all balances will be received when due.

Credit riskThe club has no significant concentration of credit risk with respect to any single counterparty or group of counterparties other than thosereceivables specifically provided for and mentioned within note 6.

The following table details the entities receivables exposed to credit risk with ageing analysis and impairment provided for thereon. Amounts are considered "past due" when the debt has not been settled within the terms and conditions agreed between the cluband the counterparty to the transaction. Receivables that are past due are assessed for impairment by ascertaining theirwillingness to pay and are provided for where there are specific circumstances indicating that the debt may not be fullyrepaid to the club.

The balances of receivables that remain within initial terms (as detailed in the table)are considered to be of high credit quality

Past due WithinGross and initial trade

Amount impaired < 30 31 - 60 61 - 90 > 90 terms2014 $ $ $ $ $ $ $Trade debtors 150,789 - - 20,295 - 5,500 124,994Sundry debtors 289,012 - - - - - 289,012 Total 439,802 - - 20,295 - 5,500 414,006

2013 $ $ $ $ $ $ $Trade debtors 43,507 - - - - - 43,507 Sundry debtors 242,684 - - - - - 242,684 Total 286,191 - - - - - 286,191

The club does not hold any financial assets whose term have been negotiatedbut which would otherwise be past due or impaired.

Collateral held as securityNo collateral is held as security for any of the trade or other receivable balances



Annual Report 2014



2014 2013NOTE 7. INVENTORIES $ $CurrentAt Cost - Stock of food, beverages & merchandise 65,292 68,021

65,292 68,021

NOTE 8. OTHER CURRENT ASSETSPrepayments 71,516 87,116

71,516 87,116

NOTE 9. FINANCIAL ASSETS - NON CURRENTInvestment in Radio Sport 927 at cost 71,902 71,902

71,902 71,902

NOTE 10. PROPERTY, PLANT AND EQUIPMENT

Buildings & Land ImprovementsAt cost 6,266,727 7,832,182 Less accumulated depreciation (1,161,637) (1,556,284)

5,105,090 6,275,897

Plant & EquipmentAt cost 3,201,598 3,677,775 Less accumulated depreciation (1,648,679) (1,950,343)

1,552,919 1,727,432

Racetrack ReconstructionAt cost - 1,062,252 Less accumulated depreciation - (297,837)

- 764,414

Motor VehiclesAt cost 223,533 237,049 Less accumulated depreciation (130,738) (141,084)

92,795 95,966

EGM EntitlementsAt cost 4,015,642 4,015,642 Less accumulated depreciation (786,381) (384,825)

3,229,261 3,630,817

LandAt valuation 2,800,000 2,800,000 At cost 12,743,846 12,743,846 Less accumulated depreciation - -

15,543,846 15,543,846

Work In ProgressAt cost 48,816,277 21,792,993 Less accumulated depreciation - -

48,816,277 21,792,993

Total written down amount 74,340,189 49,831,365

Movements in carrying amounts

Buildings & Land ImprovementsCarrying amount at beginning of year 6,275,897 6,436,016 Additions - 2,711 Disposals (1,060,936) (75,065) Depreciation expense (109,871) (87,765) Carrying amount at end of year 5,105,090 6,275,897

Plant & EquipmentCarrying amount at beginning of year 1,727,432 489,284 Additions 343,477 1,690,381 Disposals (7,401) (82,620) Depreciation expense (396,695) (369,613) Carrying amount at end of year 1,666,813 1,727,432

Racetrack ReconstructionCarrying amount at beginning of year 764,414 793,053 Additions - - Disposals (738,207) - Depreciation expense (26,207) (28,639) Carrying amount at end of year - 764,414

2014 2013





2014 2013NOTE 7. INVENTORIES $ $CurrentAt Cost - Stock of food, beverages & merchandise 65,292 68,021

65,292 68,021

NOTE 8. OTHER CURRENT ASSETSPrepayments 71,516 87,116

71,516 87,116

NOTE 9. FINANCIAL ASSETS - NON CURRENTInvestment in Radio Sport 927 at cost 71,902 71,902

71,902 71,902

NOTE 10. PROPERTY, PLANT AND EQUIPMENT

Buildings & Land ImprovementsAt cost 6,266,727 7,832,182 Less accumulated depreciation (1,161,637) (1,556,284)

5,105,090 6,275,897

Plant & EquipmentAt cost 3,201,598 3,677,775 Less accumulated depreciation (1,648,679) (1,950,343)

1,552,919 1,727,432

Racetrack ReconstructionAt cost - 1,062,252 Less accumulated depreciation - (297,837)

- 764,414

Motor VehiclesAt cost 223,533 237,049 Less accumulated depreciation (130,738) (141,084)

92,795 95,966

EGM EntitlementsAt cost 4,015,642 4,015,642 Less accumulated depreciation (786,381) (384,825)

3,229,261 3,630,817

LandAt valuation 2,800,000 2,800,000 At cost 12,743,846 12,743,846 Less accumulated depreciation - -

15,543,846 15,543,846

Work In ProgressAt cost 48,816,277 21,792,993 Less accumulated depreciation - -

48,816,277 21,792,993

Total written down amount 74,340,189 49,831,365

Movements in carrying amounts

Buildings & Land ImprovementsCarrying amount at beginning of year 6,275,897 6,436,016 Additions - 2,711 Disposals (1,060,936) (75,065) Depreciation expense (109,871) (87,765) Carrying amount at end of year 5,105,090 6,275,897

Plant & EquipmentCarrying amount at beginning of year 1,727,432 489,284 Additions 343,477 1,690,381 Disposals (7,401) (82,620) Depreciation expense (396,695) (369,613) Carrying amount at end of year 1,666,813 1,727,432

Racetrack ReconstructionCarrying amount at beginning of year 764,414 793,053 Additions - - Disposals (738,207) - Depreciation expense (26,207) (28,639) Carrying amount at end of year - 764,414

2014 2013



$ $Motor VehiclesCarrying amount at beginning of year 95,966 8,356 Additions 13,236 99,079 Disposals (6,062) - Depreciation expense (10,345) (11,469) Carrying amount at end of year 92,795 95,966

EGM EntitlementsCarrying amount at beginning of year 3,630,817 544,066 Additions - 3,471,576 Disposals - - Depreciation expense (401,556) (384,825) Carrying amount at end of year 3,229,261 3,630,817

LandCarrying amount at beginning of year 15,543,846 45,086,114 Additions - - Disposals - (29,542,268) Depreciation expense - - Carrying amount at end of year 15,543,846 15,543,846

Work In ProgressCarrying amount at beginning of year 21,792,993 4,996,139 Additions 27,023,284 16,796,854 Disposals - - Transfer to Fixed Assets - - Carrying amount at end of year 48,816,277 21,792,993

#REF! #REF!Total written down amount 74,454,081 49,831,365

NOTE 11. TRADE AND OTHER PAYABLES #REF! #REF!CurrentTrade creditors 4,502,083 238,695 Sundry Creditors 1,221,202 1,205,479

5,723,285 1,444,174

Non-CurrentSundry Creditors 1,388,639 2,009,865

1,388,639 2,009,865

NOTE 12. PREPAID INCOME - CURRENTIncome in Advance 1,267,873 1,262,794

1,267,873 1,262,794

NOTE 13. BORROWINGSCurrentEquipment Loan 54,776 53,478

54,776 53,478

Non-CurrentCommercial Bill - Secured 13,472,686 12,799,759 Equipment Loan 61,852 65,604

13,534,538 12,865,363

The National Australia Bank provide the above loans and have security over the following Club assets:71 Racecourse Road, Pakenham77 Racecourse Road, PakenhamPart of 225 McCraw Rd, Nar Nar Goon 15 Chippendale Rd, TynongFixed and floating charge over all assets and uncalled capital

NOTE 14. PROVISIONSEmployee benefitsCurrent 336,949 288,425 Non Current 51,552 66,028

388,501 354,453 NOTE 15. RESERVES

Revaluation Surplus ReserveThe revaluation surplus reserve records revaluation of non current assets



Annual Report 2014



Capital Grant ReserveThe capital grant reserve records receipt of capital funding from Racing Victoria Limited and CountryRacing Victoria Limited prior to 1st August 2006.

NOTE 16. CONTINGENT LIABILITIESThere were no contingent liabilities at the date of this report to affect the financial statements.

NOTE 17. RELATED PARTY TRANSACTIONSThe names of persons who were members of the Committee at any time during the year were:

D.Duffy Chairman M.DuffY.Blackwood F.KnaapR.Carroll M.MitchellS.Conn R.TyrrellG.Dore

No remuneration or retirement benefits are payable as the positions are voluntary. The following Committee members of the Club have received benefits from the business transactions arising in the ordinary course of the Club's business and conducted at ordinary commercial terms and conditions no more favourable than those it is reasonable to expect the Club would have adopted ifdealing at arm's length in the same circumstances

Committee MemberM.Duff Purchase of fuel products 32,322$ D.Duffy Provision of legal services 5,180$

NOTE 18. KEY MANAGEMENT PERSONNEL COMPENSATIONThe totals of remuneration paid to key management personnel (KMP) 2014 2013of the Club during the year are as follows: $ $Short-term employee benefits 579,153 550,263

NOTE 19. CASHFLOW INFORMATIONReconciliation of profit after tax tonet cash from/(used in) operating activities

Profit from operations 4,564,089 4,282,618

Non cash flows in profit - Depreciation and amortisation 1,076,471 962,929 - Amortisation Capital Funding reserve (17,904) (17,904)

Changes in assets and liabilities - (Increase) decrease in receivables (63,057) (26,983) - Decrease (increase) in inventories 2,728 19,191 - Decrease (increase) in prepayments 15,600 (78,996) - Increase (decrease) in payables (337,617) 704,119 - Increase (decrease) in provisions 39,127 37,086

Net cashflows from/ (used in) operating activities 5,279,437 5,882,061

NOTE 20. FINANCIAL RISK MANAGEMENTThe Club's financial instruments consist mainly of deposits with banks, local money market instruments,short term investments, accounts receivable and payable.The totals for each category of financial instruments, measured in accordance with AASB 139 as detailed in theaccounting policies to these financial statements as follows:

Financial Assets NoteCash and cash equivalents 5 599,669 18,132,229Receivables 6 439,802 286,191Available for sale financial assets 0 0

1,039,471 18,418,420 Financial LiabilitiesFinancial Liabilities at amortised cost - trade and other payables 11 5,723,285 1,444,174 - borrowings 13 13,589,314 12,918,841

19,312,600 14,363,015

Net Fair ValuesThe fair values of financial assets and financial liabilities are identical to their carrying values as disclosed in the Balance Sheet. Fair valuesare those amounts at which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties, in arms lengthtransaction. Where possible, valuation information used to calculate fair value is extracted from the market, with more information availablefrom markets that are actively traded.





Capital ManagementThe committee members control the capital of the Club in order to maintain a good debt-to-equity ratio and to ensure that the Clubcan fund its operations and continue as a going concern.

No capital management issues have been noted during the financial year.

NOTE 21. CLUB DETAILS

The registered office and principal place of business is 71 Racecourse Road, Pakenham VIC 3810.

NOTE 22. SEGMENT REPORTING

The club operates in the thoroughbred racing and gaming industry sector in Victoria.

NOTE 23. CAPITAL COMMITMENTS

The Club entered into a contract on September 11 2012 to purchase a hectare pacrel of land on the corner of Cardinia and Bridge Rd'sin Officer and paid a deposit of 5%. A further 50% ($1.37m) is payable within 7 days of certain conditions being met and settlementof $1.233m is due on the later of 31st January 2015 or within 14 days of certain conditions being met. The date when these conditionswill be met cannot currently being ascertained.

NOTE 24: POST BALANCE DATE EVENTS

Nil.


Statement by Members of the Commit teefor the year ended 31 July 2014

Annual Report 2014

Independent Audi t Repor t


Major Partners

Race Sponsors

SportingbetCardinia ClubCardinia ShireEvergreen TurfJEH SpencerSchweppesStar News GroupMomentum GamingWise Choice Catering

APM GroupAscot – The Pride of Pakenham Australian Post - TensioningBate ArchitectureBattery ZoneBlue Lion SuppliesBradys Carpet CourtBruce Clough MazdaCold Rock - PakenhamCora Lynn Football ClubDad & Dave’s TurfDaltons Consulting EngineersDCP GroupDG JonesEndota Spa BerwickFlowers By JoGenesys Wealth AdvisorsGerard Collins Real EstateGG EngineeringGlenmac Sales & ServiceHygainHyland SportswearIndependent DistillersJ Duff & CoKatz EntertainmentKingston TrophiesLaser ElectricalM Mauremov & Associates

Mad Daisy Racewear McMahonsMelbourne Legal PartnersMercedes Benz BerwickMinuteman PressNAB PakenhamO’ConnorOPSM PakenhamPakenham Golf ClubPakenham Produce & SaddleryPakenham Specialist Jewellers Pharmore PharmaciesPizzey NoblePro-Ride RacingRace-TechRacing NetworkReward DistributionRJ Tyrrell & CoSandown LodgeSilverwater ResortSlickpixTACTeam Staffing SolutionsTrevor Barnes SignwritingUltimate Tiles

JEH Spencer

A.C.N. 006 182 476

A.B.N. 50 249 351 616

P.O. Box 47,

Tynong, VIC, 3813.

Tel: Allan Pizzey 0419 321 287Email: [email protected]

PAKENHAM RACING CLUB

71 Racecourse Road, Pakenham Vic. 3810PO Box 141, Pakenham VIC 3810 | P (03) 5940 6600 | F (03) 5940 6649

www.pakenhamracing.com.au

CARDINIA CLUB

71 Racecourse Road, Pakenham Vic. 3810PO Box 141, Pakenham VIC 3810 | P (03) 5940 6655 | F (03) 5940 6649

www.cardiniaclub.com.au

PAKENHAM SPORTS CLUB

Henry Street, Pakenham Vic. 3810PO Box 141, Pakenham VIC 3810 | P (03) 5940 2665 | F (03) 5940 6649

www.pakenhamsportsclub.com.au

Documents

Pakenham Racing Club Annual Report 2014