Casino and race betting operator Churchill Downs Inc (CDI) is heading into this year’s Kentucky Derby on a high note.
Figures released Wednesday by the Kentucky-based CDI show the company generated revenue of $189.3m in the three months ending March 31, a 13% improvement over the same period last year. Adjusted earnings improved more than one-third to $49.2m while net income soared to $182m versus just $7.3m one year ago.
However, that net income stat includes $168.3m from CDI’s sale last November of its Big Fish Games social gaming operation to Australian gaming technology firm Aristocrat Leisure. Factoring out that windfall, CDI’s adjusted net income was a more realistic $15.8m.
CDI’s land-based casino operations led the Q1 revenue parade with $98.1m and adjusted earnings of $44.3m, year-on-year gains of 12% and 25.4%, respectively. CDI burnished its casino portfolio in March via the acquisition of Presque Isle Downs & Casino in Pennsylvania and the Lady Luck Casino Vicksburg in Mississippi.
The TwinSpires advance deposit wagering (online race betting to the rest of us) business reported revenue rising 21.6% to $63.6m and earnings up one-quarter to $16.5m, thanks to a 20.2% rise in online betting handle, which exceeded the overall US thoroughbred industry average by 14 percentage points.
Revenue from CDI’s formerly mainstay land-based racing segment was flat at $26.2m, despite Q1 2017 having endured a contagious disease outbreak at Fair Grounds Race Course in New Orleans, while Q1 2018 benefited from the timing shift of the Louisiana Derby from April 2017 to March 2018. Racing earnings were a negative $9.4m, a mild improvement from the $9.7m earnings loss one year ago.
The 144th annual Derby Week gets underway on Saturday in Louisville, Kentucky, and Thursday saw CDI showing off what it did with the nearly $70m in improvements to its flagship racetrack property. The property now offers an additional 1,800 seats, including 32 new luxury boxes and a third-floor grandstand. CDI also spent $32m on improving parking and transportation flow to handle the expected surge of guests.
