Mr. Phil Meaney:

My colleagues and I did not have the opportunity to discuss this but they may have other points they wish to raise. However, there are three or four points that I, as IGB chairman, need to put on record.

I thank the committee for the invitation to attend this meeting. The Irish greyhound industry is in the middle of the most significant period of change in its history. The need for and the scale of change required has been articulated not just by the Irish Greyhound Board but through the Indecon report which was commissioned by the Minister and was the most comprehensive review ever undertaken of the work of the board and the state of the industry. Much of our work since we last appeared before the committee has been around implementation of the Indecon report's 27 recommendations, many of which we have fully met, with significant progress having been made on the remaining recommendations. Our chief executive will deal later with some of the detail of that implementation programme.

We have had a few difficult trading years recently, notably in 2013 and 2014. The reasons for the outturns in these years are multifaceted and we can deal with them in more detail later. However, one of the fundamental causes for this is the cumulative consequence of deep cost cutting within the organisation, which has affected investment in our facilities and the marketing of our product. Ours is a cash business. By this I mean we generate sufficient cash flow to meet our operational needs on a day to day basis. Our challenge is to generate additional income to pay down significant legacy debt. In recent years, meeting that challenge has been difficult. The IGB stadium business must be viewed in the context of general economic conditions, the reduction in consumer disposable income, the reduction in the number of greyhound owners and trainers, the reduction in advertising, a reduced contribution from restaurant and general admission and in food and beverage packages. We also had a commercial strategy which needed to be more aggressive and dynamic.

In 2014, the board took significant steps to improve commercial performance through a new strategy and more appropriate levels of funding. While there will always be a time lag in the impact of the actions to reinvigorate the greyhound racing product, the benefits of the new strategy are beginning to show for 2015. To date attendances are up, track losses at IGB stadia are down and gate and concession fee income is up. Stadium branding and all marketing materials have been developed and updated and the tote brand has been updated to fit with the design of the stadium branding. There is a strong digital marketing dimension to all of our commercial work and all stadia now have their own web presence, which is linked to gogreyhoundracing.ie.

In what has been a very significant step, IGB has taken over all the food and beverage operations within its stadia. These operations are now fully integrated in terms of planning and consistency of business objectives. Food and beverage is now a key driver of future attendance and income growth. Acquiring control of this area has allowed us far more flexibility in shaping our stadium offers. It facilitates the hosting of events, such as IGB award nights, in-house and the commercial exploitation of our stadia through the hosting of events in the future. Our capacity with regard to food and beverage was well demonstrated on 19 September when 2,500 people dined on derby night, on which night food and beverage operations were carried on in parallel in five other stadia. The profits generated through the new food and beverage model will be retained in the business.

As indicated to the committee last year, new income streams have been targeted. The investment in new technical infrastructure in 2014 has allowed us to better serve potential betting partners and with additional live pictures from selected tracks we have been able to grow the basic IGB website-App offering, with significant financial outturns. In 2014, a contract was signed with William Hills and Corals, which will position IGB live-streaming pictures in front of around four million online users. All infrastructural works has been carried out by IGB and the project is being tested by end users. Live betting is expected to start later this month. A new fixed odds project and a TV offering to off course bookmakers are well advanced, reflecting a continuing commitment to new income streams and the internationalisation of the Irish greyhound racing product. Additionally, a number of American co-mingling contracts have resulted in betting from this source commencing on the Irish Tote.

Under macro financial headings, our bank position remains largely unchanged at €22.4 million. Notwithstanding the financial challenges of the past number of years, the bank position has not deteriorated. In fact, this year IGB has commenced capital repayments to reduce its overall debt by in excess of €1 million. We have made solid progress on addressing the issues around IGB’s defined benefit pension scheme and will shortly commence staff communications on this issue.

There has been much work done to address other challenges. What this industry needs to do in the first instance is restore its raw materials. The key constituent of this industry is greyhounds. Without a healthy quantum of dogs, we will have less racing, fewer quality races and a reduced export dimension to our industry. The restoration of dog numbers through increased ownership and trainer numbers is not just desirable but imperative. We recently issued a consultation paper to the industry on the issues to be faced and we hope that stakeholders will join with us in formulating incentives to drive ownership.

Members of the committee will have noted that there has been a significant ramping up of regulation recently. Amendments to legislation allowing publication of adverse findings on the use of prohibited substances and severe sanctions against the owners and trainers of dogs who test positive for these substances represent very radical change. This is just one of a series of initiatives to be undertaken by the board to enhance the integrity of racing.

Overall, the greyhound industry is going through radical regeneration and change. We are in a more confident place than we were 12 months ago. The Irish Greyhound Board welcomes its additional allocation of €1.2 million from the Horse and Greyhound Racing Fund, as announced in the recent budget. The contribution from the fund has been substantially increased for the second year in a row and represents very good news for the industry. The Indecon report pointed to the need for further investment to create the basis for a sustainable industry into the future. The additional moneys announced in last week’s budget will be targeted directly at the industry, through significant increases in prize money and the development of other supports.

We still have a series of challenges to address. Extremely high levels of inherited debt have inhibited our capacity to implement many of the things we would wish to do. The rapidly changing commercial environment, the reduction in dog numbers and the ongoing management of a whole range of legacy issues have all impacted the industry. These are issues with which any board will be faced. They will not disappear when the next board is constituted. These issues cannot be magicked away but will have to be worked at incrementally and, often painfully, over years to come. These are long-haul challenges that are not amenable to a short-term fix. This is not always recognised by industry critics of the Irish Greyhound Board. As chairman, it is my experience that many of those who are the most vocal in calling for change are, in fact, the most resistant to it. The board is charged with the overall management of the industry and its strategic direction and although it will be as engaged as it can be, it cannot reasonably be expected to micro-manage every individual issue within the industry and in each location around the country.

IGB has a commercial remit but as members will be aware there are many dimensions to the greyhound industry. It is variously a sport, a leisure business, a domestic Tote business and an international wagering business. It is a community-based activity that has a place beyond the exclusively commercial. Balancing this with commercial imperatives will continue to be a dilemma for the board and its single shareholder, the State, and by extension, Members of the Oireachtas. There is an interdependency between all of the elements of our industry which is not always apparent to those unfamiliar with it. It would be my wish that all stakeholders work closely together to meet the challenges we face against the backdrop of an improving economy.

I am sure members will wish to deal in more detail with these issues and I am happy to respond to any questions they may have.