Aki AKITANI

Deputy Secretary General

Review of Current Economic Trends in Breeding & Racing

Contents

• Review of Current Economic Trends

• How the industry is coping with

severe business environment

• How to utilize new communication methods

50000

60000

70000

80000

90000

100000

110000

120000

130000

2004 2005 2006 2007 2008 2009

Number of Foals (2004-2009)

Europe ( in Euro) 2008 2009 09/08(%)

Acclamation 30,000 20,000 66.7%

Anabaa 27,000 30,000 111.1%

Authorized 28,500 25,000 87.7%

Azamour 25,000 15,000 60.0%

Barathea 25,000 15,000 60.0%

Cape Cross 50,000 35,000 70.0%

Dalakhani 40,000 50,000 125.0%

Dansili 85,700 74,300 86.7%

Dubawi 40,000 17,100 42.8%

Dylan Thomas 50,000 35,000 70.0%

Excellent Art 25,000 17,500 70.0%

Holy Roman Emperor

35,000 25,000 71.4%

Hurricane Run 30,000 20,000 66.7%

Invincible Spirit 75,000 50,000 66.7%

Lawman 25,000 20,000 80.0%

Manduro 40,000 22,900 57.3%

Oasis Dream 34,300 34,300 100.0%

Oratorio 25,000 17,500 70.0%

Peintre Celebre 25,000 20,000 80.0%

Pivotal 97,100 74,300 76.5%

Rock Of Gibraltar 35,000 27,500 78.6%

Selkirk 40,000 28,600 71.5%

Teofilo 40,000 25,000 62.5%

Average 40,330 30,391 75.4%

　 *convert Sterling Pounds into Euro

North America (in $US)

2008 2009 09/08(%)

A P Indy 300,000 250,000 83.3%

Awesome Again 150,000 125,000 83.3%

Bernardini 100,000 75,000 75.0%

Distorted Humor 300,000 150,000 50.0%

Dynaformer 150,000 150,000 100.0%

El Prado 75,000 75,000 100.0%

Elusive Quality 75,000 75,000 100.0%

Empire Maker 100,000 75,000 75.0%

Forestry 100,000 40,000 40.0%

Ghostzapper 150,000 125,000 83.3%

Giant's Causeway 125,000 125,000 100.0%

Gone West 85,000 85,000 100.0%

Johannesburg 65,000 35,000 53.8%

Kingmambo 250,000 250,000 100.0%

Mineshaft 75,000 30,000 40.0%

More Then Ready 60,000 45,000 75.0%

Mr Greeley 125,000 75,000 60.0%

Pulpit 80,000 80,000 100.0%

Rahy 60,000 50,000 83.3%

Smart Strike 150,000 125,000 83.3%

Street Cry 100,000 150,000 150.0%

Street Sense 75,000 60,000 80.0%

Unbridled's Song 150,000 112,500 75.0%

Average 126,087 102,717 81.5%

Europe 75.4%

North America 81.5%

Sales figures at major auctions (2005-2009)

40%

60%

80%

100%

120%

140%

160%

2006 2007 2008 2009 year

percentage

Australia (Magic Million)Yearling select J une

France (Arqana)Yearling sales August

Ireland (Goffs)Annual Aggregate

J apan (Select Sale)Foals + Yearlings

New Zealand (Bloodstock)yearling sales

South Africa (National)yearling sales

UK (Tattersalls)Annual Aggregate

US (Keeneland)Annual Aggregate

France

S Africa

NZ

UK

J apan

US

Australia

Ireland

World Total Betting Turnover　 (2009)

2008

85.2 Billion Euros

200984.2 Billion Euros

(1.2% decline)

Japan 5.5%

US 9.8%

France 0.4%

Australia 12.8%

Hong Kong 9.8%

Korea 　 9.2%

Ireland 15.8%

World Economic Outlook 2010 (IMF)

Sales Figures at Major Auctions (2005-2010)

40.0%

60.0%

80.0%

100.0%

120.0%

140.0%

160.0%

180.0%

200.0%

2006 2007 2008 2009 2010

Australia (Magic Million)Yearling select J une

France (Arqana)Yearling sales August

Ireland (Goffs)Annual Aggregate

J apan (Select Sale)Foals + Yearlings

New Zealand (Bloodstock)yearling sales

South Africa (National)yearling sales

UK (Tattersalls)Annual Aggregate

US (Keeneland)Annual Aggregate

Australia

New Zealand

South Africa

UKJ apan

France

US

Ireland

World WageringFirst Half of 2010

France (PMU) + 0.6 %

Hong Kong (*Jan-Jul) +14.1 %

Italy (AAMS) - 13.3 %

Japan (JRA) - 5.0 %

Korea + 6.7 %

Singapore - 7.0 %

Sweden (ATG) + 3.1 %

Coping with Economic Downturn

Cutting Cost&

Increase Income

Recipe for Disaster

Dwelling on the past success&

Doing Nothing

Rebate Scheme(Hong Kong Jockey Club)

Losing bet exceed HK$10.000

Rebate: 10% of losing bet

Target: core customers

Pareto Principle (80-20 rules)

Lower Take-Out Rate(PMU)

Take-out rate of Win & Place bet (April 2007)18.5% 15%

Monthly total betting increase Jun 18.9%Jul 22.1%Aug 10.7%Sep 15.5%Oct 11.9%

Nov 11.2% (Nov: Win & Place +29.2%)

Deep Impact

Number of Attendance2005 Apr Satsuki Sho (GI) 85.146 (+ 6.2%) May Japan Derby(GI) 140.143 (+14.8%) Oct Kikuka Sho (GI) 136.701 (+82.0%) Dec Arima Kinen (GI) 162.409 (+29.6%)

2006 Apr Emperor’s Cup (GI) 93.944 (+ 6.2%) Jun Takarazuka Kinen(GI) 80.382 (+21.9%) Nov Japan Cup (GI) 120.182 (+25.7%) Dec Arima Kinen (GI) 117.251 (-27.8%)

Coping with Economic Downturn

Cutting Cost

&

Increase IncomeIncrease IncomeInnovation (think out of the Box)

Taking necessary risks&

Back to Basics

Racing For Change (BHA)

How to target the new customers on internet (by Mr. John Della Volpe)

How to social-network

Essence of Social Network

‘Social networks can never be a cure-it-all.

Social media networks, Apple iPhone

and other trends are useful

when we have the right products to sell’

(Singapore Turf Club)

Twitter I followed

New definition of ‘Crisis’

Crisis (by Oxford Dictionary)

‘A time of intense difficulty or danger’

危　　機Ki Ki

危　　　 crisis or danger

機　 　 opportunity

Aki AKITANI

Deputy Secretary General

Review of Current Economic Trends in Breeding & Racing