Encouraging signs at Goffs sale that bloodstock industry may finally be getting back on track
WITHIN 40 minutes of the kick-off of its most important sale on Wednesday morning, bloodstock auctioneer, Goffs looked to have a result.
The 12th lot on its catalogue of 400 yearling thoroughbreds, offered at this year’s Orby sale, sold for €775,000 to bloodstock agents Peter and Ross Doyle, guaranteeing that the top price achieved at last year’s running of the sale would be more than doubled.
Chief executive Henry Beeby, who auctioned the horse himself, pronounced himself pleased. “Thirteen of the first 14 lots sold: the first horse made €300,000, the top price last year was €350,000, so we’ve more than doubled that,” he said.
Racehorse trainer and breeder Jim Bolger sold the horse via his Redmondstown Stud operation. It was a double result for him, as he will train the horse, a filly, next year for its buyers, an as yet unidentified syndicate for whom the bloodstock agents were acting.
The reason they were willing to part with €775,000 for her is down to family. Her brother is Europe’s leading juvenile two-year-old racehorse, and looks destined for further glory next year, followed potentially by a lucrative stud career.
Bolger bred both from the sire New Approach, which he trained to win the 2008 Epsom Derby. Beeby pointed out that, given her family tree, the filly is already a potentially valuable breeding prospect, irrespective of what happens on the racecourse.
The price was topped late yesterday when South African agent Jehn Malharb paid €800,000 for a colt fathered by Coolmore Stud stallion Galileo. Malharb, who trades as Form Bloodstock, actually outbid Coolmore to buy the horse.
On Wednesday, Beeby readily conceded that €775,000 was a far cry from five years ago, when the top-priced horse sold in the Kildare auction ring went for €2.4 million. That was literally the peak for Goffs.
The following year, 2008, the sale took place as Lehmann Brothers collapsed and the European and US financial systems went into freefall. The company felt immediate reverberations. Bloodstock agents were ringing clients for whom they would normally have expected to bid for horses and were told “not now, call back next week”.
For a quite a few, next week never came. Bloodstock followed financial services and an array of other businesses into freefall. Goffs turnover plunged from €123 million to €71 million in 2008 and from there to €49 million in 2009 and €45 million in 2010, before coming back to €55 million last year. The company responded by cutting €4 million from its budgets in 2008 and reducing staff by 35 per cent.
In what is a familiar story for a lot of businesses, it also found itself with a bad debt hangover. Goffs guarantees its vendors will be paid in 35 days, which means that it has to chase up the buyers, some of whom never paid for horses bought just as the boom was fizzling out.
It took a €5.7 million hit in its accounts for the 12 months to the end of March 2010, which is its financial year, leaving it with a €6.4 million loss. “We decided that we had to deal with the problem up front,” Beeby said.