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Revenue reaches record $590.9m at Churchill Downs in Q1

| By Robert Fletcher
Churchill Downs Incorporated (CDI) posted a record $590.9m (£473.0m/€551.1m) in net revenue during its first quarter, although net profit fell year-on-year.

Revenue for the three months to 31 March was up 5.6% from $559.5m in the same period of last year. It is also a new, all-time quarterly high for CDI.

This also follows on from a record 2023 for CDI. During the past full-year, revenue amounted to $2.46bn, with growth across all core business areas in 2023.

Record Q1 for Live and Historical Racing

In Q1, two out of three core segments at CDI reported growth. Most noticeable was within its Live and Historical Racing, where revenue increased by 14.3% to $245.1m, another new quarterly record for the business.

CDI said this rise was primarily the result of growth at its Kentucky properties, with revenue here up $18.3m. An additional $13.5m of revenue was also noted at its Virginia venues.

In addition, the operator noted the impact of its new Rosie’s Emporia venue, which opened in Virginia in September 2023. 

Gaming revenue slips 4.3%

Elsewhere and the news from the Gaming segment was not so positive. Revenue declined by 4.3% to $239.2m. Incidentally, Gaming was the primary source of revenue for the group in Q1 last year.

CDI put this drop down to a $6.3 million decrease in Pennsylvania. This was mainly due to the decision not to renew a management agreement at Lady Luck Casino Nemacolin in June 2023.

The group also noted the impact of inclement weather in January 2024. This, it said, led to a $2.1m net decrease in revenue at its other gaming properties.

Exacta acquisition drives TwinSpires growth

The remaining $106.6m of Q1 revenue came from the TwinSpires business. This was 12.5% higher than in the same quarter last year.

The main reason for this growth, CDI said, was additional revenue from the purchase of historical horse racing provider Exacta in August 2023. This generated an additional $14.3m in revenue when compared to Q1 of 2023.

CDI also noted a $2.3m increase attributable to retail and online sports betting business. In addition, horse racing revenue was up $1.2m.

Net profit down 48.4% at CDI

In terms of spending in Q1, total operating expenses were up 5.7% year-on-year to $464.6m. Costs were higher across all business segments, while selling, general and administrative expense also edged up.

Other, finance-related expensed for the quarter amounted to $24.5m. This is in contrast to the $89.0m in income noted last year. However, the Q1 2023 figures were boosted by the sale of its Arlington Heights property in Illinois to NFL franchise the Chicago Bears. The sale resulted in a $114.0m gain for CDI.

As such, pre-tax profit for Q1 this year hit $101.8m, down 51.3%. CDI paid $21.4m in tax, leaving a net profit of $80.4m, down 48.4% from $155.7m in 2023.

What else is happening at CDI?

As for other recent developments at CDI, the group in Q1 announced the new Rose Gaming Resort. This is due to open in Virginia in late September, with 500 additional historical racing machines.

CDI also set out development plans for Owensboro Racing & Gaming with a planned opening in Q1 2025. This will feature 600 historical racing machines, a retail sportsbook, simulcast wagering and food and beverage offerings.

In addition, CDI this month finalised the sale of a 49% stake in its United Tote subsidiary to the New York Racing Association (NYRA). The deal, agreed in August 2022, sees NYRA Content Management Solutions, a subsidiary of the NYRA, acquiring the stake.

United Tote primarily supplies totalisator systems, services and equipment. It also provides a range of technology services to process bets and pay-outs and pari-mutuel tote services.

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