First Day of Dealings
January 30 2008 - 2:00AM
UK Regulatory
TurfTrax Plc
(`TurfTrax' or the `Group')
First Day of Dealings
TurfTrax Plc, the international horse racing data and data products origination
and distribution company, is pleased to announce the admission of its ordinary
shares to trading on the AIM market of the London Stock Exchange ('AIM').
Admission Statistics
Admission price: 40p
Number of Placing Shares: 8,000,000
Number of ordinary shares in issue immediately following admission: 43,980,188
Market capitalisation upon admission at admission price: �17,592,075
Group Overview
The Group operates through four divisions; Tracking, Course Services, Betting
Services and Ground Management Systems. Over the past six years the Group has
established itself as a respected provider of data and services to the horse
racing and other sporting industries.
Following successful admission to AIM, it is the intention of TurfTrax to
expand its commercial activities within the UK and international horse racing
and betting markets to which it supplies technical services and data products
related to the real-time, `in-race' speed and position tracking of race horses.
By exploiting its tracking data, the Group has developed a betting product that
for the first time enables the provision of fixed odds `in-running' betting
with dynamically changing prices. The Board of TurfTrax believes that this new
betting product represents the most significant product revolution within horse
race betting in the past 20 years and anticipates the opportunity for the
capture of significant revenues in the UK through revenue share agreements with
established bookmakers who have distribution channels on track, in shop and
online.
In 2006, total horse race betting turnover exceeded �10bn in Great Britain
alone, and generated the horse race betting industry approximately �680m of net
win (gross profit less levy and gross profit tax).
Adam Mills, Chairman, commented:
`Since its inception, TurfTrax has built a highly regarded reputation for the
professional delivery of data and services to the horse racing industry. Since
that time, we have continuingly supplied products and services directly to the
UK's top race courses including Ascot, Newmarket and Cheltenham, as well as
providing a range of data services to leading media outlets including the BBC,
Channel Four, The Racing Post and The Sun. We have now begun to enter into
commercial arrangements with leading bookmakers and have had our core
technology mandated by the British Horseracing Association.
The recent development of our `in-race' betting product and successful
flotation on AIM (when coupled with our established reputation within the
industry) presents TurfTrax with the ideal opportunity to have a significant
impact on horse race betting whilst generating the Group revenue streams on a
global basis. We at TurfTrax recognise the prevailing trend away from
traditional betting products to 'in-game' formats and are proud to be
positioned to be the first company in the world to enable such betting with
respect to horse racing.
I would like to thank everybody for their efforts in bringing the Group to this
point and look forward to reporting on progress over what we expect to be a
significant year for the business'.
Business of the Group
The Group operates through four divisions, Tracking, Course Services, Betting
Services and Ground Management Systems.
Tracking
The Group's Tracking division deploys a patented tracking system, comprising
hardware and software, on racecourses which enables the collection and
broadcast of real-time speed and positional data of horses during the course of
a race.
The tracking system comprises a lightweight transmitter (a "Mobile Tag"),
placed in the saddle cloth of each horse in the race, data receivers at
pre-surveyed locations around the racecourse and a central data position
processor. The Mobile Tag transmits a signal at a rate of up to seven times per
second from which speed and positional data for each horse is calculated. Using
the Group's software platform, real-time data is processed and broadcast. This
real-time data allows fixed odds in-running betting at a dynamically changing,
automated price. The data also enriches the presentation of racing information
on television, in the media and on on-course displays.
TurfTrax Racing Data Limited has agreements giving it exclusive rights to
deploy a tracking system to collect and commercialise speed and positioning
data from 37 of the 59 UK racecourses. These rights give TurfTrax Racing Data
Limited the opportunity to cover 66 per cent. of UK horse racing in 2008. These
agreements are with Racing UK Ltd, a media organisation representing 30
racecourses and with Arena Leisure Racing Ltd who owns and operates seven
racecourses including three of the UK's four all weather courses.
The Group has provided data to media agencies and television production
companies, such as Channel 4 and the BBC, who have used the Group's in-running
graphics and form analysis in their broadcasts. In addition, TurfTrax Racing
Data Limited also has an agreement with `Attheraces', a dedicated horse racing
channel, to provide speed and positional data to complement its existing
broadcast product.
In October 2007, the Group, in conjunction with a development partner, launched
the "Pricer", a software application that generates a continuously updating
fixed odds price for each horse for the duration of a race. The price is
generated through the integration of real-time speed, positioning and
pre-existing data.
A trial stand-alone terminal utilising the Pricer software has been installed
in a licensed betting office in the UK and further installations are expected
to be rolled out shortly.
In 2006, total betting turnover in Great Britain was approximately �10 billion.
Based on the Horse Race Betting Levy the net win on bets placed (gross profit
less levy and gross profit tax) from UK horse racing was approximately �680
million for the year to March 2006. The Directors consider that the most
significant revenue generating opportunity for the Group is from a revenue
share of the net win available to a bookmaker through the provision of the
fixed odds Pricer. Initial response from a significant part of the UK
bookmaking industry has been positive and the Group anticipates launching a
fully commercial product, capable of integration into a bookmaker's risk
management system during the first quarter of 2008. In the UK, the Directors
are not aware of any direct competitor in the fixed odds in-race betting market
and expect to generate significant growth for the Group from this sector.
To date, the Group has generated revenue from the sale of data and from the
sale of a tracking system. Further opportunities for the sale of tracking
systems in ten countries are currently being explored.
The Group owns or has applied for patents in relation to the tracking system.
Course services
The Group recognised a commercial opportunity in the racing industry to provide
courses with a scientific and objective measure of the Going. The Group's
principal product is the GoingStick, which enables the Going to be analysed by
measuring penetration and shear of the ground. Following a DGPS (Differential
Global Positioning System) survey of the racing surface a detailed grid is
created in which GoingStick readings are displayed creating a map of the Going
on the course ("Going Map").
On 31 March 2007, the Horseracing Regulatory Authority initiated a 12 month
mandatory trial for use of the GoingStick, on all 58 UK turf racecourses. Under
this directive, all Clerks of the Course are required to provide a GoingStick
reading at the declaration stages and on racedays. The readings are published
alongside the Clerks' official Going reports. The Going Maps have also been
broadcast by the BBC, Channel 4 and `At The Races' for major race meetings. The
GoingStick has also been sold or leased by the Group in Australia, France, and
Hong Kong.
The Group has also supplied and installed fully automated weather monitoring
systems to 26 UK racecourses.
The Group is currently generating revenue from the sale of GoingSticks and from
service charges in respect of the GoingStick and the automated weather
stations.
Betting services
The Group operates an online, registration based, racing form guide, tipping
service and news consolidator at www.TurfTrax.com. The website has
approximately 27,000 registered users. Users can register free of charge which
allows them access to most of the website's content. Premium website content
and features are available for paying subscribers.
For premium subscribers, TurfTrax.com includes a bespoke tipping service, "The
Predictor", which applies a number of algorithms to publicly available data to
derive statistics which determine a horse's chance in a race. The Predictor is
available for all horse races run under regulatory authority rules in the UK
and Ireland. A limited version of TurfTrax.com including The Predictor is
available via mobile platforms.
The Group generates revenue from a monthly subscription charge from premium
subscribers and from white label form guides and content deals.
Ground management systems
The Group provides a consultancy service specialising in soil and surface
engineering, including the use of non-invasive geophysical surveys.
The Group generates revenue from the design, remediation and project management
of new and existing natural and synthetic turf sporting surfaces for local
authorities, racecourses, sports clubs and stadia.
Copies of the TurfTrax AIM Admission Document are available from the offices of
City Financial Associates Ltd.
-Ends-
For further information:
Mark Kent TurfTrax Plc + 44 (0)1722 434000
Stephen Goschalk Newland Stockbroker Ltd + 44 (0)207 290 2414
Liam Murray City Financial + 44 (0)207 492 4777
Associates Ltd
Andrew Tan Hansard Group + 44 (0)207 245 1100
END
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