The company that runs Farmlands Horse of the Year has reported a $297,000 shortfall in the revenue it expected for the first half of its financial year but said it remains confident the high-profile event will return to profit in 2015.

Horse of the Year (Hawke's Bay) Limited's half-year report for the six months to November 30 will be considered by Hastings District Council's finance and monitoring committee when it meets on Thursday.

The council is a one-third shareholder in the company, as are Equestrian Sport New Zealand and Show Jumping Hawke's Bay.

Horse of the Year reported a $108,000 full-year loss in October and it was revealed last month the company was putting its management contract - held by industry stalwart Kevin Hansen's business interests for the past 18 years - out to tender after this year's show takes place next month.


The new half-year report says following the 2013/14 loss, managing cash flow had been "a significant challenge" so far this financial year.

"We have been using income and revenues intended for [the] 2015 show to finalise creditors from [the] 2014 show. However, directors and management are confident that a budget has been approved, and controls are in place to produce a profit in this financial year which will see a return towards financial stability."

The accounts show the company received income of $554,000 during the six months to the end of November, $297,000 below the $851,000 it budgeted for and $62,000 below what it received during the same period a year earlier.

However, in a report to the committee, the council's acting chief financial officer, Bruce Allan, said: "Given the nature of this organisation and the event that it runs, the first half of the year financials provide limited insight into the potential full-year result."

The show sends out invoices for deposits for booked trade sites during the half-year covered by the report, with the bulk of its income generated in the following six months.

The company said trade site sales for this year's show had been strong "and indications are that virtually all sites will be sold".

However it is planning a "no growth" show in 2015 as it claws back from last year's loss.

"The focus is to ensure that we are getting good value from all contracts plus the introduction of improved security to reduce gate sales and camping revenue leakage."


The council was told last year that the event lost revenue in 2014 due to problems with security fencing which allowed non-payers into the show.

Further development of relationships with Chinese equestrians, who were funded to attend last year's show, had been "put on hold until 2016".

Hastings Deputy Mayor Cynthia Bowers, who is also chairwoman of Horse of the Year's board of directors, reiterated yesterday that she did not believe the half-year report raised any major concerns for the company.

"For this year's show, all of the revenue that we can track at this point in time is actually tracking pretty well," she said.

The report said government agency Sport New Zealand had agreed to fund a consultant to review the 2015 show, with findings due to be reported back to the board by March 31.

"The timing of this review has been carefully planned to coincide with the tender of the event management contract," the report said.

Mrs Bowers declined to comment on the tender yesterday, however the report says the board intends to finalise the tender process by May.

Mr Hansen - whose company Event Pro last year merged with a similar Australian-based business, Equine Productions - said last month he planned to move to Australia for business reasons, but would put in a bid to keep running the event.