NYC OTB in Financial Crisis

[Kasept]

Originally Posted by philcski

Correction, 6%. They've had 4 straight years of operating losses though (according to Bloomberg). It almost seems unfathomable but the results are in print (they do have to publish a 10K)

Except it takes someone like Matt Hegarty to decipher what's actually in that print... NYC OTB is making money after including the city surcharge they write as an expense... Profitable by +$11 million in 2006 according to Hegarty when sifting through the filings.

Over the weekend, Hegarty and Steve Crist utterly debunked the gross fallacy announced by Bloomberg Thursday. In fact, it turns out that NYC OTB's problems can be largely traced to their own miscalculation 4 years ago when they pushed for night thoroughbred action. After lining up Mountaineer and Penn National and making a deal to stipend the harness tracks, the geniuses discovered there was little income in the TB evening sessions. Oops. Of course now they're paying a premium back to the harness tracks on business that existed before their tactical error. But somehow it's Albany's fault. I'm no fan of Albany and their inept meddling in racing, but here is one case where they are a somewhat innocent bystander.

HEGARTY: OTB finances a complex equation
http://www.drf.com/news/article/90395.html

CRIST: Bloomberg way off base on OTB (DRF Plus subscription required)
http://www.drf.com/drfNewsArticle.do?NID=90405

And for those that decry the lack of mainstream media coverage of racing? Don't decry yourselves a river. As brought up by Crist in his searing column, The NY Times, when reporting on Bloomberg's yapping Friday, included the assessment that "OTB is saddled with payments to the beleagured racing industry." That's rich. Can you imagine the nerve of the beleagured racing industry "demanding" to be paid their cut on the OTB handle that only exists because of their product? Too funny. In this case, having the mainstream media report on racing can only do more harm than good.