Churchill Downs exceeds Q2 expectations with record revenue

LOUISVILLE - Churchill Downs Incorporated (NASDAQ:CHDN) reported second quarter earnings that exceeded analyst expectations, driven by strong performance in its Live and Historical Racing segment and record Kentucky Derby wagering.

The gaming and racing company posted adjusted earnings per share of $2.99, beating the analyst estimate of $2.96. Revenue reached an all-time record of $934.4 million, surpassing the consensus estimate of $919.53 million and representing a 5% increase from the same period last year.

The 151st Kentucky Derby delivered all-time record all-sources handle for the Kentucky Derby Race, Kentucky Derby Day Program, and Kentucky Derby Week and also saw continued strong performance across our historical racing machine venues in Kentucky and Virginia.

The company’s Live and Historical Racing segment was the primary growth driver, with revenue increasing $50.7 million or 10.3% to $540.9 million. This growth was fueled by a $23.8 million increase from Virginia HRM venues and a $22 million increase from Kentucky HRM venues.

The Gaming segment experienced a decline, with revenue decreasing $8.1 million to $266.3 million, primarily due to the cessation of HRM operations in Louisiana. The Wagering Services and Solutions segment saw revenue increase 5.3% to $168.4 million, driven by higher Derby Week wagering.

Churchill Downs ended the quarter with net bank leverage of 4.2x and returned $250.4 million to shareholders through share repurchases. The company’s board approved a new $500 million share repurchase program on July 22.

Additionally, the company announced plans to acquire 90% of Casino (EPA:CASP) Salem in New Hampshire for $180 million, continuing its expansion strategy.

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