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Ownership – the financial reality

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  • #6183
    apracing
    Participant
    • Total Posts 3214

    I’ve just been going through my Weatherbys statements reviewing costs and returns for my ownership of Salute during 2007 and I thought the figures might make interesting reading for TRF members.

    Bear in mind, he won three races during the year, a 0-85 handicap and two claimers, and he was also second twice, including in the Queens Prize worth £16,000. He ran twelve times, ten of those in handicaps and only one of those races was rated lower than 0-85 – that was a £10k amateurs race at Ascot. Such was his consistency that he picked up prize money in ten of those twelve races.

    Twelve starts, three wins, seven other races in which he picked up money – very few horses in training will match that.

    The costs are straightforward as I have an agreed monthly payment to my trainer that includes transport and all regular vets procedures. During 2007, there were no extras on top of that payment. The gallops are rented from Paul Cole and are paid for by a monthly fee through the Weatherbys account.

    Training costs – £12,960

    Then add the cost of entry fees – we only made three unused entries all year and one of those was free (Shergar Cup), plus the riding fees (£108.88 for a flat jockey).

    Total running costs – £2060

    So the total outlay was a fraction over £15,000.

    In return, he earned total prize money of £14,800, with the main contributors apart from the three wins (£4300, £2780, £1600) being the seconds at Kempton (£2600) and Wolverhampton (£1370). To add to that we picked up appearance money for two runs on Sundays and for being a reserve for the Shergar Cup, total £725.

    So the total income was £15,525.

    Result, a great deal of pleasure and an overall profit of about £500. It’s not difficult to see how much it costs if your horse is unsuccessful. or even wins three races like Salute, but in lower grade races.

    And consider that training costs would be much higher elsewhere and that most trainers make far more than 15 entries for 12 runs in a year. One of the features of my working relationship with Pat Murphy is that I plan the program and decide on the entries. The races we entered for and didn’t run in cost me just under £140, so you can see how quickly that would mount up.

    In 2008, training costs will rise (feed, bedding, farrier, diesel, wages etc are all rising in price) and prize money will fall. If Salute followed the same program and won the same races, I estimate the gap between income and returns would be approx £2500.

    And Salute now has three stable companions in the same colours (although unlike Salute, my personal involvement in them isn’t 100%) – we must be mad!

    AP

    #133845
    moehat
    Participant
    • Total Posts 7922

    you say that your transport costs are included in your agreed training fees, but I’ve only just realised how annoying it is for owners when their horses are taken to a racecourse only to find that the days racing is cancelled at the last possible moment..

    #133850
    onefurlongout
    Member
    • Total Posts 197

    certainly the sport of kings then! :lol:

    #133852
    MikkyMo73
    Member
    • Total Posts 1789

    Great insight Alan, thank you very much.

    I think I will stick to G1 Jockey on the Wii thank you :lol: .

    Seriously, it’s great to see your enthusiasm for the sport and that you’ve bought more horses, despite your knowledge that the reality is they won’t make much profit – if any.

    Your new horses – are any of them 2 year olds, or have you claimed, privately bought older horses? If they are older horses, have you ever thought of buying a 2 year old, naming it yourself, and hoping one day it will be racing at Royal Ascot – or is the reality of that happening just way too costly?

    Sorry for so many questions. Once again, thanks for your great insight, it’s much appreciated. I’m atually shocked that a horse that wins a quarter of his races and picks up prize money in around 80% of his races, hardly makes any profit.

    Mike

    #133855
    Charlie D
    Member
    • Total Posts 500

    AP

    I think your mad as a hatter, but without people like you investing, we wouldn’t have sport . So well done to you, P Murphy and anyone else involved with Salute

    You can have a decent wet with £500 btw :D

    #133856
    ahitchcott
    Member
    • Total Posts 60

    very interesting read. i admire your dedication!

    id say in the long run the experience makes it all so worthwhile, id like to do it myself one day, not as a profit making scheme (although obviously thats a bonus!) but purely cause i think it would be a fantastic experience.

    #133858
    alan1
    Member
    • Total Posts 167

    One of the things that really gets my goat as an owner is entry fees, for a start they are never what they say they are. The Racing Post may say in the conditions of a race that x number of horses entered at £15 each, however for some reason which I can never quite fathom, that £15 is nearer £40 when it appears on my Weatherbys statement.

    But I suppose it is the principal that I really object to, not only will you pay me peanuts if my horse actually wins (I think around £1200 for tomorrows race), but also you expect me to pay you so you can use my horse.

    The analogy I would use is if you were an actor in a West End Show, which was also being broadcast live on telly. The Theatre are getting income from tickets and lots of extras, plus are receiving a fee from the TV company. They then turned round and said, actually only the Lead Actor will get paid everyone else will have to pay us to be in the show.

    It just wouldn’t happen!! The actors union would see to that.

    If only the ROA had some teeth.

    #133860
    apracing
    Participant
    • Total Posts 3214

    Mike,

    The other horses are all older ones bought at the sales. Power Shared bought at Doncaster in August has already been running and has finished third and fourth in his last two juvenile hurdles.

    Then there are two sprint handicappers – Impromptu bought as a replacement for the retired Greenwood – and Sun Catcher, both purchased on the first day of the Newmarket Horses in Training sales.

    I’ve never been interested in 2-y-old racing and my limited experience of it in syndicates back in the 80’s offered no encouragement to repeat that involvement. The big drawback is that most yearlings you can buy are useless and even the good ones can suffer massive depreciation. For example, Sun Catcher was 37,000gns as a yearling and won three races, but we got him for a third of that price.

    AP

    #133865
    alan1
    Member
    • Total Posts 167

    Alan

    If I’d known you were after a sprint handicapper you could have made me an offer for Bookiesindex Boy!!

    Alan

    #133867
    Friggo
    Member
    • Total Posts 1593

    Thanks AP, it’s great to get a genuine account of the actual outlay owning a horse requires. You’re also very lucky to have such a useful animal, making a profit out of owning a horse must be a wonderful feeling, getting all that enjoyment and coming out of it with change!

    #133871
    Black Sam Bellamy
    Participant
    • Total Posts 442

    Alan – I wouldn’t expect you to divulge specifics…but have you made a profit backing Salute this season (considering you have effectively mapped out his season) ?

    #133876
    apracing
    Participant
    • Total Posts 3214

    BSB,

    Yes – I only backed him twice, the first and last races of the season, both at Wolverhampton. The first time he was offered at an insulting 30/1 on BF and I backed him at a lot shorter when he won the claimer, having always intended to bet in order to offset the low prize money for that race. I pass on 10 – 20% of any winnings to the staff at the yard, but even after that, the profit this year was enough to cover my share of Sun Catcher.

    Most times I’m happy to let him run unbacked as the prize money is good enough if he wins.

    I’d hate to get my account books out though and work out how much I lost backing Greenwood over the four years we had him – his ability to get beaten in photos and only win when I least expected it made him very expensive!

    AP

    #133898
    Fist of Fury 2k8
    Member
    • Total Posts 2930

    I’ve just been going through my Weatherbys statements reviewing costs and returns for my ownership of Salute during 2007 and I thought the figures might make interesting reading for TRF members.

    Bear in mind, he won three races during the year, a 0-85 handicap and two claimers, and he was also second twice, including in the Queens Prize worth £16,000. He ran twelve times, ten of those in handicaps and only one of those races was rated lower than 0-85 – that was a £10k amateurs race at Ascot. Such was his consistency that he picked up prize money in ten of those twelve races.

    Twelve starts, three wins, seven other races in which he picked up money – very few horses in training will match that.

    The costs are straightforward as I have an agreed monthly payment to my trainer that includes transport and all regular vets procedures. During 2007, there were no extras on top of that payment. The gallops are rented from Paul Cole and are paid for by a monthly fee through the Weatherbys account.

    Training costs – £12,960

    Then add the cost of entry fees – we only made three unused entries all year and one of those was free (Shergar Cup), plus the riding fees (£108.88 for a flat jockey).

    Total running costs – £2060

    So the total outlay was a fraction over £15,000.

    In return, he earned total prize money of £14,800, with the main contributors apart from the three wins (£4300, £2780, £1600) being the seconds at Kempton (£2600) and Wolverhampton (£1370). To add to that we picked up appearance money for two runs on Sundays and for being a reserve for the Shergar Cup, total £725.

    So the total income was £15,525.

    Result, a great deal of pleasure and an overall profit of about £500. It’s not difficult to see how much it costs if your horse is unsuccessful. or even wins three races like Salute, but in lower grade races.

    And consider that training costs would be much higher elsewhere and that most trainers make far more than 15 entries for 12 runs in a year. One of the features of my working relationship with Pat Murphy is that I plan the program and decide on the entries. The races we entered for and didn’t run in cost me just under £140, so you can see how quickly that would mount up.

    In 2008, training costs will rise (feed, bedding, farrier, diesel, wages etc are all rising in price) and prize money will fall. If Salute followed the same program and won the same races, I estimate the gap between income and returns would be approx £2500.

    And Salute now has three stable companions in the same colours (although unlike Salute, my personal involvement in them isn’t 100%) – we must be mad!

    AP

    Your hardly mad as the pleasure you get out of it is worth every penny..but you know that already or wouldn’t be doing it.

    I was mega lucky to have my best friend ride and eventually train my first horse. After he died I was with Jonjo at Skelton and he was great and kind enough to give me the same deal……..I have seen owners spend 250,000 pounds and never had a winner and not bat an eyelid…….sport definitely gets a grip of you and it’s hard to let go.

    My first horse won as we had planned and we had a right touch. It paid back all the expenses, including the cost of the horse, plus a good bit on top for the 18 months bills building up to it…..Then a few races after that we landed another touch but nothing untoward. It just worked out that way as it does sometimes………..But that, as you know is exceptional and the majority of owners lose out big time as they never have a winner.

    As things are more expensive these days I would imagine would have to allow at least18-20K pa to cover the cost and assume you are not going to get a coin of it back….you are obviously running a tight ship and know what you are doing……if you happen to be lucky and get a win or 2 then regard it as a bonus. The cost would probably be 50% higher with someone like Pipe……I nearly fainted when his dad spoke to me and tried get me to move my horse out of the yard he was in……that was back in the late 80’s and his prices were a joke in comparison……back then I simply couldn’t have paid what he was asking.

    You are really lucky with the travel costs being built in……….some trainers make their extras from transport as owners never take much notice of how the horse actually gets to the races…..it’s too easy for the trainer to charge full whack.Chances are the horse was actually taken to the races by the yard up the road at a much lower rate than an owner gets billed for.

    How much is left after deductions these days AS, if you win and it’s 10,000 pounds to the winner?

    #133904
    chloed
    Member
    • Total Posts 433

    ap you have had a result all the fun and just about a balanced ledger, vets fees alone are horrendous [dont know if spelt that right had a glass of wine].
    my vet is charging £2.00 per minute attendance +travelling+drugs etc.

    #133908
    Zoz
    Member
    • Total Posts 703

    Thanks for putting this up Ap, makes for really interesting reading and highlights very well how different the situation would look were an owner to have a horse with a set back or basically not as talented as yours.

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