Churchill Downs Reports Q4 2023 Earnings Of $561.2 Million, Topping Estimates 

Churchill Downs Incorporated (CDI) announced its business results for the quarter and full year ending Dec. 31, 2023.

The highlights include a 36% increase in net revenue to a new record of $2.46 billion, compared to $1.81 billion in the prior year.

For the last quarter of 2023, CDI reported earnings of $561.2 million, which surpassed all estimations.

CDI’s fourth quarter 2023 and full-year gaming highlights

During the last quarter of 2023, CDI’s gaming revenue increased $18.0 million from the prior year quarter. The success was driven by:

• $22.3 million coming from the New York and Iowa properties
• $3.0 million attributable to the Louisiana and Maryland properties
• A decrease of $5.0 million because of CDI’s decision not to renew the management agreement at Lady Luck. CDI’s other wholly-owned properties reported an additional $2.3 million decrease in revenue in four states

Adjusted EBITDA for the Q4 2023 increased $1.0 million from the prior year quarter driven by:

• A $6.0 million increase coming from New York and Iowa properties
• A $1.3 million increase through Louisiana and Maryland properties
• A $0.2 million increase from the company’s equity investments

The increase was partially offset by:

• A $4.2 million decrease at CDI’s other wholly-owned properties
• A $2.3 million decrease attributable to proceeds for business interruption insurance claims related to Hurricane Ida received in the fourth quarter of 2022

CDI’s full-year gaming revenue for 2023 increased $212.8 million, mainly led by a $230.0 million increase attributable to the New York and Iowa properties acquired in the P2E Transaction.

Revenue was also affected by a $16.9 million decrease in Pennsylvania, primarily due to the company’s decision not to renew the management contract at Lady Luck and a $0.3 million net decrease from its other gaming properties.

CDI’s 2023 growth most apparent in its live and historical racing sector

CDI shared its enthusiasm about its revenue being up 36.0% year-over-year. While the operator reported increases across all core business areas in 2023, its live and historical racing segment was the most prosperous.

CDI’s revenue from live and historical racing saw an incredible 70.4% rise to $1.05 billion, a new record for the vertical.

Revenue for 2023 increased to $438.2 million, driven by a $313.9 million increase thanks to Virginia casino properties. These were acquired in the company’s Peninsula Pacific Entertainment (P2E) purchase in November 2022. The company reported:

• A $41.2 million increase in revenue in Northern Kentucky, mainly due to the opening of Turfway Park in September 2022
• A $36.4 million increase attributable to properties acquired in the Ellis Park and Chasers transactions
• A $20.7 million increase due to a record-breaking Derby Week at Churchill Downs Racetrack
• A $19.2 million increase coming from Derby City Gaming property and the opening of Derby City Gaming Downtown in December 2023 in Louisville, Kentucky
• A $16.5 million increase from CDI’s Oak Grove property in Southwestern Kentucky

Meanwhile, the company saw a $9.7 million decrease for non-Derby Week racing operations. It was primarily due to a portion of the Churchill Downs Racetrack Spring Meet moving to Ellis Park.

CDI makes room for improvement

Apart from the 2023 financial results, CDI revealed details about new racetracks set to open in Northern Virginia and Western Kentucky.

Phase one of The Rose in Virginia has been approved and is now scheduled to open at the end of September. The project would cost about $460.0 million, and the facility will feature:

• 1,650 historical racing machines (HRMs)
• 102-room hotel
• Eight food and beverage options
• Over 2,540 parking spaces

CDI revealed plans to open Owensboro Racing and Gaming in Kentucky in the first quarter of 2025. With a planned spend of nearly $100.0 million, the new facility will eventually offer:

• 600 HRMs
• A retail sportsbook
• Simulcast wagering
• Multiple food and beverage offerings

Owensboro Racing and Gaming is estimated to generate $125 million annually in regional economic impact, bringing more than 200 construction jobs and 150 permanent jobs.

The details about the New Hampshire HRM facility are yet to be updated.