Cliff Williams, Contributor
CHIN-SEE
ON THURSDAY last, William Chin-See, incumbent Board chairman of Caymanas Track Limited, the sole promoters of live horseracing in Jamaica, convened a press conference to give a review of the performance of the company over the three-year stewardship of the directors serving currently.
For those who may not be aware, I think it is necessary to give some information on the state of the promoting company and what the Chin-See-led Board found when it was convened in 2001. In terms of the debt-ridden company's financial position, what existed was a pending disaster with the Government and the Off Track Betting (OTB) operators, significant contributors to the worsening situation.
Specifically, the Government's obligation to support purses through the Bookmakers Levy Scheme was accumulating massive arrears through late and short-payments amounting to approximately $51 million in 2001. Add to this, the high level of delinquency amongst certain OTB operators in meeting their financial obligations on a timely basis, as well as many who left the company with receivables that were not collectable and what was in place was a promoting company with serious cash flow problems threatening its viability.
RACING PRODUCT FELL SHORT
Caymanas Track Limited, against this background, as well as having to borrow $35 million to meet bets, winnings, taxes, and needing to have a bank overdraft to meet its financial obligations, lost approximately $100 million on its 2001-2 operations. Then there was the additional problem where the racing product fell short of what it should be in terms of offering competitive races on a consistent basis as well as a marketplace that was teeming with both legal and illegal lotteries and numbers games.
This Situation Analysis would not be complete without a quick look at the relationship between the promoting company, the regulatory bodies, the Jamaica Racehorse Owners' Association and the Jamaica Racehorse Trainers' Association. According to Mr. Chin-See there was absolutely no harmony between Caymanas Track Limited and the Betting Gaming & Lotteries Commission so much so that a fine of a million dollars was levied against the promoting company for non-payment of bets winnings taxes before the new Board even had a chance to come to terms with the magnitude of the task of returning it to viability.
RESTIVENESS
Then there was restiveness amongst the owners and trainers over the inadequacy of the purse structure and one has to concede that the Board, in resolving the issue, as it was then, by negotiating and delivering a significant improvement to the prize money, did a hugely successful job.
Truth be told, at the outset the composition of the Chin-See-led Board of Directors was greeted with scepticism in many quarters as it was felt there was not enough racing knowledge amongst its various members, and I suppose the concerns were somewhat legitimate but still, there were too many who were reluctant to adopt a wait-and-see attitude to what the new administration was bringing to the table.
Having turned around the fortunes of the promoting company through the application of fiscal discipline and enhanced management capability, I think Mr. Chin-See can be forgiven for the swipe he took at the previous administrators.
He referred specifically to the awarding of certain contracts to insiders, the lack of capital expenditure, the financially irresponsible way too many of the OTB operators were allowed to operate without adequate guarantees and for the acrimonious relationship between the promoting company, the regulators and the professional Associations.
Coming from a loss position of approximately $100 million in year one to delivering an operating profit of around $60 million in year three is most certainly commendable and next week I will be taking a look at how this was achieved, the current state of the promoting company and whether divestment is a necessary option.
