INFORMATION ABOUT HIPODROMO DE LA ZARZUELA

The horse racetrack of La Zarzuela opened its doors for the first time on May 1941. Since then, horse races have taken place in an uninterrupted way until 1996, the year when the activity was interrupted as a result of the unfeasibility of the then operating company. Later, Patrimonio Nacional (National Heritage) organized two public invitations for tender with the goal of awarding the horse racetrack's management, but these finally did not come to fruition.

On July 31st, 2003, the Sociedad Estatal de Participaciones Industriales and Loterías y Apuestas del Estado (the state-owned Lottery) (LAE) incorporated the company Hipódromo de La Zarzuela, S.A. which received the mandate of managing the above horse racetrack, and in which SEPI holds 95% of the capital and LAE the remaining.

The company has stockholders' equity amounting to 18 million euros, which have been disbursed, after the Council of Ministers approved the company's incorporation, on June 13th. On June 24th, The Board of Directors of the state-owned holding SEPI authorized the company in charge of Madrid´s horse racetracks, Hipódromo de la Zarzuela, S.A., to increase its social capital in 8 Million Euros. The funds raised through that capital increase are invest to carry out the investments needed for reopening the facilities.

The recuperation of this horse racetrack fulfils the Green Paper made by the Congress on July 20th, 1999. Equally, it entails the promotion of the horsing activity and of popular sport and reactivates a service which has infrastructures which currently are disused, located in a natural space protected by the Environmental Protection Plan.

Besides, the reactivation of the horse racetrack of La Zarzuela represents an improvement in the infrastructures available in Madrid. The first day for the horse races at the horse racetracks of La Zarzuela in Madrid was on Sunday October 23rd, 2005.

With the incorporation of the new company which will manage the horse racetrack of La Zarzuela, SEPI and LAE have given the first step towards the fulfillment of three fundamental goals:

These facilities, which belong to Patrimonio Nacional (National Heritage), has been and will be again the cornerstone both of the competition and of English thoroughbreed horse breeding. The beginning of its set up guarantees the continuity of turf in Spain, the growth of the number of horses born, and as a result, the increase of the number of mares for this purpose.

On the other hand, the beauty and the spaciousness of the facilities, adjacent to the natural area of El Pardo, its nearness to the capital's center and to the municipalities with the highest income levels in the autonomous region of Madrid, as well as the unique character of the horse racetrack stands, which were designed by the engineer Eduardo Torroja (in 1980 they were declared an Historic-artistic monument), offer it a great potential for the design of leisure activities of the highest quality which may be enjoyed daily.

Activity of the company in year 2009:

The HIPÓDROMO DE LA ZARZUELA has practically maintained its activity during a negative financial environment for the companies which operate in the leisure industry.

During 2009 a total of 200 horse races have taken place, in 34 meetings; 14 meetings and 86 horse races in the Spring, 8 meetings and 40 horse races in night events on Thursdays, and 12 meetings with 74 horse races in the Fall, which has meant 3 meetings and 21 horse races less than during the previous year.

As for attendance, this reached on average 2,772 persons per meeting, practically the same than that recorded in 2008. For day races the average attendance was 2,650 persons, the same than in the previous year, while in night races the average was of 3,169 spectators, against 3,006 in 2008.

The operating income reached 16.6 Million Euros, of which 15.5 Million Euros correspond to the turnover, which means a 11.7% reduction against the year before, as a result of the reduction in the income generated by internal bets (which were 23% lower), in the sponsorships and the decrease in the aids granted by the Asociación Española de Sociedades Organizadoras de Carreras de Caballos (AESOCC).

In financial terms, HIPÓDROMO DE LA ZARZUELA recorded a loss after taxation of 2.7 Million Euros, which is 1 Million Euros more than in 2008, basically as a result of the above mentioned income reduction.

During the year a number of investments have taken place within the facilities, which amounted to 1.8 Million Euros; special mention must be made to the investments in infrastructures renovation and the refurbishment of the stands and nearby areas. With the activities performed during the year, the investment accumulated in the horse racetracks since their reopening reaches 44.5 Million Euros.