All Bets Are Off. Equine Flu Outbreak Shuts Britain’s Racetracks
(Bloomberg) -- U.K. bettors were sidelined this weekend at horse-racing tracks as authorities grappled with a strain of equine flu linked to an episode that disrupted events in Australia a decade ago.
The outbreak in Britain means racing is suspended, as it has been since Thursday. The British Horseracing Authority, the sport’s governing body, says there will be no resumption until Wednesday at the earliest while tests are conducted on thoroughbreds across the country.
On Saturday, the BHA identified the flu strain as “Florida Clade 1,” which is endemic to North and South America. The regulatory body said that while British horses are vaccinated against Clade 1, and the Clade 2 strain, endemic to Europe, “this is clearly more virulent than the European strain” and so able to affect vaccinated horses.
The BHA’s chief regulatory officer, Brant Dunshea, told Sky News the equine flu outbreak in Australia in 2007 brought racing to a halt in Melbourne -- home of the country’s biggest race -- for a week, and disrupted races for “much longer” in other parts of the country.
For bookmakers William Hill Plc, Paddy Power Betfair Plc, and Ladbrokes owner GVC Holdings Plc, the cancellations are a blow, though maybe not a major one. For now at least, the industry’s period of inactivity is a relatively short one, while customers can still place wagers on events in other countries, virtual races and sports including Premier League soccer.
“While the loss of U.K. horse racing is a negative, substitution into other products is likely,” Goodbody analysts wrote in a note. Unlike in the case of poor weather, “football and other U.K. sports are also taking place.”
The impact on the major betting groups will be lessened because U.K. horse racing is diminishing in its importance to them, accounting for at most 10 percent of revenue at Paddy Power Betfair, 9 percent at GVC and 15 percent at William Hill, according to Goodbody.
William Hill is “very confident” of being able to withstand a period of no U.K. racing without “too much impact,” spokesman Ciaran O’Brien said by phone.
That period is currently a brief one. In total, the confirmed six days of the shutdown cover 23 meetings and 152 races. To put that into perspective, the first quarter of 2018 saw 317 races canceled due to adverse weather, according to Goodbody.
The possibility of a longer cessation is a far bigger concern, especially with the lucrative Cheltenham Festival little more than four weeks away. In 2001, an outbreak of foot-and-mouth disease on the eve of the showpiece event saw it called off, though analysts say it is too early to speculate on the length of the current shutdown.
The BHA said Friday that three more horses have been diagnosed with equine flu at the stable that first reported the outbreak. While no positive samples have been reported anywhere else, an unconfirmed “suspicious case” has been identified at a separate yard, it said.
The governing body plans to make an announcement on Monday about whether it is safe for racing to resume and that is likely to be key for share prices that have fallen 2 percent to 5 percent since the shutdown was enforced.
Veterinary and race-planning teams are preparing for a range of scenarios under which racing could recommence, including options for rescheduling meetings and races that have been canceled, the BHA said.
“The risk is more of an extended cancellation, rather than an outsized impact of the current one week cancellation,” Morgan Stanley analysts led by Ed Young wrote in a note.
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